Qualcomm lands $12-billion nonbinding deal to supply Chinese smartphone makers
Traveling with President Trump on a trade mission to China, Qualcomm officials said late Wednesday that the company has signed an agreement with Chinese smartphone makers Xiaomi, Vivo and Oppo to supply $12 billion in components over the next three years.
The deal is nonbinding. Qualcomm Chief Executive Steve Mollenkopf and officials from the Chinese smartphone firms signed the memorandums of understanding in Beijing in a ceremony led by Xi Jinping, president of the People’s Republic of China, and Trump.
Mollenkopf was part of Trump’s Department of Commerce trade delegation to China, which included executives of leading American companies.
The announcement comes as Qualcomm readies to respond to what will probably be a hostile $105-billon takeover bid from Broadcom.
Early this month, Broadcom Chief Executive Hock Tan appeared with Trump in a ceremony in the U.S., where he pledged to return Broadcom’s headquarters from Singapore to the U.S.
Regulators globally are expected to closely scrutinize a potential Broadcom-Qualcomm combination. The combined company would be a leading supplier for cellular, Wi-Fi, Bluetooth, radio frequency filters, transceivers and other chips on smartphone circuit boards.
While Chinese phone brands are largely unknown to U.S. consumers today, analysts believe China’s smartphone makers have ambitions to sell handsets worldwide in coming years.
Qualcomm said it has been supporting the Chinese mobile ecosystem for almost 25 years and continues to expand its investments in China, establishing a number of branches, joint ventures and research and development centers.
“I’m honored to represent Qualcomm as part of this important trade delegation, which showcases the importance of win-win business relationships between the U.S. and China,” Mollenkopf said in a statement.
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