Partnerships / Acquisitions

Qualcomm May Acquire NXP

Qualcomm may acquire NXP Semiconductors in a move that would provide revenues from the automotive industry. The deal could be for as much as $30 billion and would be the second-largest chip industry acquisition this year.

The ripple effects of falling smartphone sales are emerging and affecting mobile device parts suppliers, such as Qualcomm. The mobile chipmaker Qualcomm may acquire Netherlands-based NXP Semiconductors for over $30 billion, according to The Wall Street Journal, in a possible effort to move into other business areas.

Qualcomm also supplies a range of telecom products and services. If completed, the acquisition would be the second-largest in the chip industry this year after SoftBank’s acquired ARM for $32 billion.

The deal could take two months to complete, but it would propel Qualcomm into the automotive space. NXP is the fifth-largest chip supplier in the world and the leader in security-based identification chips, particularly for car-related applications. NXP also co-created NFC in conjunction with Sony.

Qualcomm has previously acquired a Bluetooth and Wi-Fi chipmaker supplying the automotive sector, but the company gave no comment on its overall acquisition strategy, and NXP did not reply to a request for comment in time for publication.

In response to the news, NXP shares rose by 19.3 percent to $98.09; Qualcomm’s rose by 8.5 percent to $68.83. NXP had a market value of about $28.5 billion before the announcement, while Qualcomm was valued at around $93 billion.

NXP, formerly known as Philips Semiconductor, is an industry leader worldwide. The company acquired Freescale Seminconductor for $12 billion last December. This deal also boosted NXP’s revenues from wearable devices and health monitors and is allowing the company to build capacity in security and payments.

Qualcomm, which provides chips to Apple and Samsung for their devices, has suffered from declining smartphone sales and competition from Chinese and Taiwanese rivals.

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