President Donald Trump says China is willing to approve a major merger between American chip maker Qualcomm and rival NXP. One problem: It's too late.
Qualcomm said Monday the clock ran out on the merger, and it is ready to move on.
"While we were grateful to learn of President Trump and President Xi's comments about Qualcomm's previously proposed acquisition of NXP, the deadline for that transaction has expired, which terminated the contemplated deal," a Qualcomm spokesperson said in a statement. "Qualcomm considers the matter closed and is fully focused on continuing to execute on its 5G roadmap."
California-based Qualcomm (QCOM) confirmed in July it was terminating its proposed takeover of Dutch counterpart NXP (NXPI) after China failed to grant it regulatory approval. Qualcomm even paid a $2 billion penalty in July for breaking off the merger.
A victim of tension between the United States and China, Qualcomm and NXP had waited for regulatory approvals for nearly two years before Xi's administration let the clock run out. The takeover had been approved in eight other jurisdictions, including the European Union and South Korea, since it was announced in October 2016.
Qualcomm moved ahead with a stock buyback of about $30 billion that it had promised shareholders should the NXP deal fall apart. NXP declined to comment.
Trump and Chinese President Xi Jinping met in Buenos Aires Saturday, and Trump told reporters that Xi said he would reconsider China's prior decision to withhold approval of the planned $44 billion merger between Qualcomm and NXP.
"If that deal came back to him, he would most likely approve it quickly," Trump said. "Which is a big thing."
China's official statement after the meeting between Xi and Trump did not mention Xi's willingness to consider approving a $44 billion deal for Qualcomm to purchase NXP if the deal was put before him again.
The dissolved deal was one of the most visible repercussions of the escalating trade war between the United States and China, the world's two largest economies.
The trade dispute was instigated by Trump, who is displeased with the United States' trade deficit with China. The dispute escalated, with both countries slapping hundreds of billions of dollars in tariffs on each other's goods.
Trump and Xi met for two hours over dinner during the G20 summit in Argentina. The meeting came days after Trump pledged to hike tariffs on $200 billion worth of Chinese goods, even as he expressed optimism about a forthcoming deal with Xi.
After the meeting, Trump said they had reached an "incredible deal."
Trump said the United States would be "holding back on tariffs, and "China will be getting rid of tariffs."