When President Trump killed semiconductor maker Broadcom’s (AVGO) ambition to take over rival Qualcomm (QCOM) due to security worries, it was another win for Trump because the latter backed from the deal. But that definitely didn’t hamper Broadcom’s willpower of eyeing fresh targets for acquisition in the U.S., as Broadcom has relocated its base from Singapore to the U.S.
In 2017, when the Singaporean tech giant was making a hostile bid to take over the pioneer of cellular modems Qualcomm, it promised to re-domesticate to the U.S. to avoid scrutiny by CFIUS, the committee that evaluates the cross-border deals.
Though the Qualcomm deal is dead, the company had to move back to the U.S. as part of its Brocade Networks acquisition. With this $5.9 billion acquisition – Brocade will be the subsidiary of Broadcom and will help the company gain a major hold in the storage area networking.
The company has announced that it has successfully changed their domicile from Singapore to the U.S. with its current co-headquarters in San Jose, California being the only headquarters for the company. By transferring its domicile to the U.S., Hock Tan’s company can resume with its deal-making plans without the obstacles from the CIFUS.
However, the company stated that its next acquisition target would be much smaller than its previous proposed deal with Qualcomm. If the deal between the two rivals clicked, it would have been noted as the largest high-tech acquisition.
Broadcom has grown considerably through acquisitions under the helm of its CEO Hock Tan. In fact, Broadcom Corp was acquired by Avago Technologies Ltd in 2016, post which it retained the same name, Broadcom Ltd.
Despite the shift, Broadcom will continue to trade under the same ticker and all the shares of Broadcom Ltd. has been swapped to the Broadcom Inc. Tan said that by relocating to the U.S., Broadcom is expected to bring back nearly $20 billion in annual revenue to the U.S. But this move will not create any new direct jobs or plants in the U.S., which is not appreciated by the job seekers.
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