handed the title of board chairman to an independent director, while its suitor
pledged Friday not to sell strategic pieces of its target to foreign companies, the latest maneuverings as the U.S. reviews a proposed hostile takeover between the two.
who has been on the Qualcomm board since 2016 and was previously finance chief of Cardinal Health Inc., will take over as nonexecutive chairman.
who served as executive chairman and was Qualcomm’s chief executive from 2005 until 2014, will remain on the board.
The dueling announcements Friday address areas each company finds particularly sensitive as they scramble for support from regulators and shareholders.
Qualcomm’s decision to establish an outside director as nonexecutive chairman appears to be a further step in emphasizing the board’s independence. The change removes Mr. Jacobs from the management team, where previously he oversaw long-term initiatives. Mr. Jacobs, the son of Qualcomm co-founder
invented critical parts of the company’s technology.
It is in shareholders’ best interests for Qualcomm to have an independent director as chairman at “this important juncture,”
Qualcomm’s lead director, said in prepared remarks.
Also on Friday, Broadcom sent a letter to members of Congress defending its $117 billion hostile takeover of Qualcomm, one of several steps Broadcom has taken to win support for its proposed deal. Broadcom pledged to not sell “any critical national security assets to any foreign companies.”
Broadcom, which sells a diverse line of equipment for networking and communications, made an initial offer to buy chip maker Qualcomm in November. Qualcomm has rejected Broadcom’s advances, consistently noting a national-security review as a potential stumbling block to a deal.
“The bottom line is that a combined, American Broadcom-Qualcomm will be a more focused and stronger champion for sustained United States leadership in 5G than a standalone Qualcomm, an outcome that strongly supports America’s national security interests,” Broadcom Chief Executive
said in a letter to U.S. lawmakers.
Broadcom is working to redomicile its business from Singapore to the U.S., a move it has said will be completed by May 6. It has also pledged to annually invest $3 billion in research and engineering and $6 billion in manufacturing.
The promises of billions in spending allocated to U.S. research and manufacturing came two days after Broadcom pledged $1.5 billion to educate engineers in the U.S., a move to address U.S. government concern that the country risks losing technology leadership to China.
Broadcom stressed its American technological roots, drawing on national tech stalwarts such as the former Hewlett-Packard, AT&T and Broadcom itself. The company said its board is comprised mainly of American citizens and that the company is managed out of San Jose, Calif., despite currently being based in Singapore.
Earlier this week, the Committee on Foreign Investment in the U.S. ordered Qualcomm to postpone its shareholder meeting so that the interagency group could review the proposed takeover of the chip maker.
A letter from a CFIUS official to both companies’ lawyers said “in significant part,” the committee’s national-security concerns were classified, but that “they relate to the risks associated with Broadcom’s relationships with third-party foreign entities and the national security effects of Broadcom’s business intentions with respect to Qualcomm.”
“Reduction in Qualcomm’s long-term technological competitiveness and influence in standard setting would significantly impact U.S. national security,” the letter said. “This is in large part because a weakening of Qualcomm’s position would leave an opening for China to expand its influence on the 5G standard-setting process.”
Separately on Friday Qualcomm extended the offer period of its tender offer to buy all the outstanding common shares of
NV. The new expiration date is March 16. Qualcomm has been working for more than a year to buy NXP, which could help it fend off Broadcom by significantly increasing Qualcomm’s business.
—Ted Greenwald contributed to this article.