Qualcomm has been trying to acquire NXP Semiconductors, a Dutch company that’s best known for Internet of Things and automotive chips, for almost two years. However, the deal had been held up by the Chinese government to the point that it will no longer be going through. Qualcomm will thus have to pay a breakup fee so this entire failed endeavor has cost the chipmaker $2 billion.
Qualcomm announced its agreement to acquire NXP back in October 2016. The deal was valued at $46 billion. The deadline to close this deal has already been extended multiple times as the companies waited on China to either approve or deny the deal. Other countries that were reviewing the transaction had granted approval.
China has still not given a decision on the matter and with the deadline ending tonight, Qualcomm has no plans to extend it. If something happens before midnight ET then the acquisition might go through but it seems unlikely that China would issue an approval for the transaction in the next few hours.
“We intend to terminate our purchase agreement to acquire NXP when the agreement expires at the end of the day today, pending any new material developments,” confirmed Qualcomm CEO Steve Mollenkopf in a statement.
Qualcomm will have to pay NXP a breakup fee of $2 billion. The deal falling through also frees up almost $30 billion in cash for Qualcomm that it had put aside to pay for the acquisition. That money will now be used in a stock repurchase program, according to Qualcomm.