Qualcomm's acquisition may trigger semiconductor "restructuring domino effect"

【Global Web Reporter Wang Huan】 “Nihon Keizai Shimbun” reported on November 9th that Broadcom has begun to promote the largest merger and acquisition in the history of the semiconductor industry and proposed to purchase another semiconductor giant, Qualcomm, for US$130 billion. The Internet of Things (IoT) and big data era have arrived and it is expected that semiconductor demand will further expand. In the semiconductor industry, there have been 10 large-scale mergers and acquisitions that have been disclosed in excess of 1 trillion yen in the past three years. With fierce competition for high-quality companies with advanced technologies, the “restructuring domino effect” of the semiconductor industry has already become overheated.

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“I used to be interested in integrating Qualcomm's mobile business and Broadcom's platform. This combination can bring huge benefits to shareholders, employees and customers.” CEO Hock Tan wrote to Qualcomm’s board on November 6th. The letter emphasized the significance of the acquisition.

Qualcomm has an overwhelming presence in the field of smart phone semiconductors, Broadcom is good at broadband communications semiconductors. If both parties join hands, the communication semiconductor field will be born with an absolute leading enterprise.

Broadcom is targeting the huge market of the Internet of Things. The Internet of Things, which connects IT equipment such as smartphones and industrial machinery, is supported by communication technologies, and its core is semiconductors. Softbank Group had previously decided to invest about 3.3 trillion yen in the acquisition of UK semiconductor design company ARM Holdings, because the head of Softbank Agencies Sun Jung that "with the popularity of the Internet of Things "(semiconductor industry) will begin to switch modes."

Not only the Internet of Things. In the automotive industry, which is advancing technological innovations such as autopilot, semiconductors have become increasingly important as a key technology for competitiveness. The largest US company in the area of ​​personal computer CPUs (CPUs) decided in March to acquire Mobileye, an Israeli large-scale automotive semiconductor company. To meet the arrival of the era of automated driving, Intel took the initiative.

In cutting-edge fields such as Internet of things and autopilot, there are a limited number of semiconductor manufacturers with high-tech strength and technology patents. "The fancy business may be bought by anyone." This anxiety is one of the reasons why companies have implemented mergers and acquisitions one after another. Although some people have pointed out that “the semiconductor bubble has already appeared”, due to the expectation of reorganization, many semiconductor manufacturers’ stock prices are rising, and it is thought that there will continue to be huge acquisitions in the future.

With the large-scale mergers and acquisitions, the semiconductor industry has rapidly become monopolized, and anti-monopoly authorities in various countries and regions around the world have become the focus of these oligopolists. If Broadcom acquires Qualcomm, even if both parties agree, if it is deemed to be too prominent in the field of telecommunications semiconductors, the review of the Anti-Monopoly Law may become an obstacle.

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