A U.S. government panel that reviews deals for potential national security concerns is looking into the buyout bid by Singapore-based semiconductor company Broadcom Ltd. (NASDAQ: AVGO) for San Diego's Qualcomm Inc. (NASDAQ: QCOM), which is fighting to remain independent.
The Committee on Foreign Investment in the United States (CFIUS), an interagency body headed by the Treasury Department, has ordered Qualcomm to delay its March 6 shareholder meeting by 30 days to accommodate the inquiry.
Qualcomm investors were slated to vote at the meeting on whether to give Broadcom a majority on Qualcomm's board of directors.
“This measure will afford CFIUS the ability to investigate fully Broadcom’s proposed acquisition of Qualcomm,” a Treasury spokesperson said in a statement.
Qualcomm set April 5 as the new date for the meeting.
Broadcom, in a statement, accused Qualcomm of underhandedly requesting the investigation to postpone the vote. The overseas chipmaker, which is looking to acquire Qualcomm for $117 billion, said Qualcomm did not reveal it had reached out to CFIUS during the companies' recent interactions.
But Qualcomm said Broadcom's supposed surprise over the review was disingenuous.
"Broadcom has been interacting with CFIUS for weeks and made two written submissions to CFIUS," the San Diego company said March 5.
Broadcom said it will cooperate with the inquiry. Its statement gave the impression its interest in the acquisition was undimmed.
Qualcomm stock was down about 1 percent as of market close.
Reach reporter Sarah de Crescenzo at firstname.lastname@example.org.