According to analysts, the failed takeover may prove to be the highest profile victim yet of the trade spat between China and the U.S. Other jurisdictions had cleared the bid months ago. China said the deal has nothing to do with trade tensions.
The failure of the deal is a blow to both companies. Qualcomm, which was looking to reduce its reliance on a slowing smartphone, will now have to go it alone as it looks to develop silicon for the automotive market.
Qualcomm will be paying NXP a $2 billion breakup fee and will be looking to buy back as much as $30 billion in stock. For NXP, after almost two years on hold, the termination of the deal will raise questions as to whether it has a future as an independent company.
“There were probably bigger forces at play here than just us,” said Qualcomm Chief Executive Officer Steve Mollenkopf, speaking before the deadline passed. “We are still fans of the deal and the logic behind the deal.”
The failure of the deal has raised questions over other transactions in the $400 billion semiconductor industry, which has undergone a period of consolidation in the past few years.