By Miriam Raftery, East County Magazine
March 1, 2018 (Washington D.C.) -- Following up on efforts last week to have the Trump Administration initiate a review of the proposed takeover of San Diego-based Qualcomm by Broadcom, Ltd, Congressman Duncan Hunter (R-50) sent a letter to Defense Secretary Jim Mattis requesting his personal and direct involvement before a shareholder meeting occurs on March 6. Subsequently, Congressman Scott Peters (D-52) joined the call to halt the merger.
“As Secretary you have the ability, at this moment, to ensure America’s security for a generation by protecting against a takeover of American technology that would do nothing short of crippling our defense against China,” wrote Congressman Hunter. “News reports indicate that there is a debate within CFIUS over whether it should act in this case. Therefore, time is of the essence. I respectfully request that your personally advocate for CFIUS to act quickly and block any action on this sale pending a full security review and investigation. Semper Fi.”
The Committee on Foreign Investment in the United States (CFIUS) is the inter-agency committee responsible for reviewing transactions where control of a U.S. company could be administered by a foreign influence. Multiple reports are indicating that CIFUS has taken steps that Congressman Hunter called for in his initial letter to President Trump by initiating a review of the potential hostile takeover. While several government officials comprise the membership of CIFUS, Secretary Mattis holds significant influence in foreign business acquisitions where the potential for national security risks exists. Broadcom acquiring Qualcomm meets this standard and the timing is critical as a takeover attempt could occur at the Qualcomm shareholder meeting on March 6.
Hunter has opposed the takeover based on national security implications and the threat such action would have to the thousands of Qualcomm employees in San Diego. A copy of Hunter’s letter to Secretary Mattis can be viewed here.
Congressman Peters also cites national security concerns and has asked Treasury Secretary Steven Mnuchin to provide a classified report to House and Senate intelligence committees on the national security implications of Broadcom taking over Qualcomm.
Peters said Qualcomm is the leading American company in the race to roll out ultra-fast 5G mobile networks, the San Diego Union-Tribune reports. An acquisition by Broadcom could slow down that work, handing 5G leadership over to Chinese and Korean firms, he suggested, adding, “In the national security space, for instance, we do a lot to make sure we have ship building capabilities onshore. We have shipbuilders that we give contracts to just so we have that expertise. It seems even more critical that we hold onto this (5G) expertise by protecting Qualcomm from a foreign takeover.”