Broadcom withdraws Qualcomm offer after Trump rejects deal

Broadcom withdrew its offer to buy U.S. chipmaker Qualcomm on Wednesday following President Trump’s decision to block the Singapore-based company’s hostile takeover on national security grounds.

“Although we are disappointed with this outcome, Broadcom will comply with the Order,” the company said in a statement.

Broadcom also vowed to move forward with its plan to shift its operations to the U.S. Broadcom CEO Hock Tan announced that plan at the White House last year in an appearance with Trump.

{mosads}The president decided to block the deal on the advice of the Committee on Foreign Investment in the U.S. (CFIUS), an interagency panel that investigates foreign business deals for national security concerns.

CFIUS was worried that Broadcom’s takeover would lead to a decline in investments in research and development in the sector, opening the door for Chinese firms to take the lead in developing next-generation wireless technology.

The administration was also concerned about Broadcom’s relationship with third-party foreign entities, according a White House official who was not authorized to discuss the CFIUS investigation.

Broadcom had repeatedly tried to persuade U.S. officials that it didn’t pose a threat. It promised to start a $1.5 billion innovation fund and committed to building on Qualcomm’s investments in new technologies like 5G wireless networks.