Qualcomm has withdrawn its application for competition clearance in China for its takeover of NXP Semiconductors, after an initial negative reaction to its proposed remedies. Qualcomm said it refiled the application in another effort to obtain approval.
Clearance from China is the last regulatory hurdle for Qualcomm in the long-running bid for NXP. China sees the proposed acquisition as having a substantial impact on the technology industry and possible negative effects on the market, a spokesman for China’s Ministry of Commerce said, according to a report from Bloomberg. Gao Geng said that the authority talked with Qualcomm about how to reduce the negative impact on the market and has conducted market tests using the remedy plan from Qualcomm. However, an initial investigation "shows Qualcomm’s plan can hardly solve relevant problems", the spokesman said.
The ministry will continue to investigate the deal, but a decision is unlikely to come soon because it needs a "large amount of time to investigate, collect evidence and analyze", the spokesman said.
Meanwhile Qualcomm continues to extend the bid for NXP. The companies have agreed to extend their deadline for completing the deal, first announced in October 2016, to 25 July 2018, from a previous deadline of 25 April. Qualcomm said it agreed to pay the break-up fee if all regulatory approvals had not been received by the new deadline.
At the last count on 13 April, the company had acceptances for 16.2 percent of NXP shares. The bid has been extended again until 27 April. Qualcomm said it also completed the waiting period for comment on the deal in the US, resulting in renewed clearance from the US Federal Trade Commission.
