Instead, Broadcom has resorted to what is essentially a hostile takeover by putting forward a slate of six Broadcom nominees for Qualcomm's 11-member board.
"This was a blatant, desperate act by Qualcomm to entrench its incumbent board of directors", the company said in a statement.
Losing this key role in standards-setting could pose a threat to United States national security and also open up a place for China to fill with its own wireless companies, such as Huawei, CFIUS said.
Qualcomm just concluded its 5G day in San Diego, California, where it showed off a number of new demos showcasing what the new Snapdragon 845 can do.
The U.S. government has ordered a national security review of Singapore-based Broadcom's $117 billion bid to acquire U.S. chipmaker Qualcomm, in an unusual move that prompted the latter to delay its March 6 shareholder meeting.
Qualcomm on Monday postponed a shareholder vote on Broadcom's nominees for Qualcomm's board after the committee on foreign investment in the United States, which treasury leads, ordered a delay to review the deal.
Broadcom has started a new offensive in its effort to take over Qualcomm, promising to invest Dollars 1.5 billion to train engineers in the USA and make the country a leader in 5G technology. The US government has already expressed repeated concerns about Huawei and ZTE, moving to close off their access to the American market, and the fear is Broadcom could allow the Chinese to take the lead on setting 5G standards.
Singapore-based Broadcom also reiterated that it plans to shift its headquarters to the U.S.no later than May.
The government action on March 4 highlighted growing US concerns about safeguarding semiconductor technology and cast a doubt on the deal's success. The company said it recognizes "the important role CFIUS plays in protecting our national security, and is fully committed to cooperating with CFIUS in any review".
USA regulators have cited concerns over China's influence on the 5G standard-setting process in announcing an investigation into Singapore-based Broadcom's hostile takeover of Qualcomm.
The announcement comes two days after the government sent Broadcom and Qualcomm a letter outlining reservations about a potential tie-up between the two chip makers. That would have opened the door further to Broadcom taking over Qualcomm. Typically when CFIUS weighs in with worries, that signals the end of a potential deal. A source familiar with CFIUS says that if the deal goes through, there may be no other option for American carriers than to rely on Huawei. Instead the CFIUS's unease hinges on Qualcomm being a national champion in the areas of standard-setting and chip R&D and the apparent concern that it would be diminished in this respect once in the suffocating embrace of Broadcom.