Additionally, the executive order prohibits a list of 15 Broadcom people from serving as a director with Qualcomm, plus Qualcomm can't even accept nominations or votes for any of them.
Also, The Committee on Foreign Investment in the United States, which reviews the national security implications of foreign investments in USA companies, had cited concern that Broadcom has a penchant for cutting costs, which might lead to Qualcomm being less of an industry leader. Broadcom's key units are US-based; the company is headquartered in Singapore, which is generally considered friendly to the US.
Last November, Broadcom made a steep, unsolicited $103B offer to acquire Qualcomm. Patrick Moorhead, an analyst with Moor Insights & Strategy, says Qualcomm is one of the few wireless chip companies that invests for the long term.More news: Kendall Jenner addresses the gay rumours
Broadcom said earlier this year it would fully be a USA domiciled company by May 6.
Industry analysts speculate that Qualcomm's advanced work on 5G technology, which is expected to provide speeds needed to fuel the "internet of things", was the reason.
"The Broadcom review shows Cfius has ample tools to block foreign takeovers of US firms that threaten national security", the newspaper said.
"Qualcomm has become well-known to, and trusted by, the U.S. government", said Deputy Assistant Secretary for Investment Security Aimen Mir. The agency operated under the Treasury Department and examines deals or takeovers that could potentially give a foreign investor control of the business in the United States.More news: Farewell a brilliant mind and an even braver man - Stephen Hawking
The block was recommended to President Trump by the Committee on Foreign Investment in the United States, or CFIUS.
Today Broadcom officially announced that it is ceasing its efforts to acquire Qualcomm.
The company launched its bid for the takeover back in November of a year ago and was spontaneously and repeatedly rejected by Qualcomm's board and management. The company withdrew its proposed candidates for Qualcomm's board, but still plans to move its headquarters to the United States.
A Broadcom-Qualcomm merger would create a new and powerful rival in two areas that Intel is banking on for future revenue growth: smartphone processors and data centers, according to the Journal.More news: Trump's executive order blocks Broadcom's $140B acquisition bid for Qualcomm