Douglas Lane & Associates LLC Purchases 58013 Shares of QUALCOMM, Inc. (NASDAQ:QCOM)

"There is credible evidence that leads me to believe that Broadcom. might take action that threatens to impair the national security of the United States", Trump wrote in a Monday executive order that blocked the deal.

Citing national security issues, US President Donald Trump has ordered that Broadcom immediately abandon its proposed acquisition of Qualcomm.

The president's order is the latest sign of Trump's tough stance on foreign takeovers of U.S. technology, and dovetails with a broader move to contain China on trade and deal-making.

Additionally, the presidential order also disqualifies all of Broadcom's proposed directors for Qualcomm.

Broadcom was informed on 4 March that Qualcomm had filed a request with the Committee on Foreign Investment in the U.S. to investigate if the takeover might endanger national security, the company said in a statement.

Qualcomm has yet to comment, but will no doubt be celebrating the news after rebuffing multiple offers from Broadcom claiming they "undervalue" the company and its "leadership position in mobile technology".

In an attempt to ease those worries, Broadcom last week pledged to make the US a leader in the race to build 5G networks, saying it would create a $1.5 billion fund to support the effort if took control of Qualcomm. But if Qualcomm is off the table for reasons related to industry standards and national security, the same would most likely be true for similar-sized targets Texas Instruments (NASDAQ: TXN) and Micron Technology (NASDAQ: MU).

According to Bloomberg, Trump acted on a recommendation from the Committee on Foreign Investment in the United States (CFIUS), which reviews foreign acquisitions of American firms.

Keep in mind that the decision from Donald Trump can not be appealed since it is a presidential order, and Broadcom's executives have not stated their intentions on what they will end up doing next.

Tan bought California-based companies Broadcom for $37 billion in a leveraged deal in 2015 and Brocade Communications in a $5.5 billion deal two years later.

Broadcom was trading up about 1.1 percent Tuesday morning, while Qualcomm was down 4.8 percent at $59.75.

Now that Broadcom has been shoved aside, Qualcomm will be under pressure to prevent its stock price from sinking while trying to complete its own proposed takeover - a proposed $43 billion purchase of NXP Semiconductors.

Meanwhile, Broadcom announced today that is has accelerated its timetable for redomiciling its organization from Singapore to the US, moving up the date from May 6 to April 3.

Intel, which competes directly with both Qualcomm and Broadcom, was up 2.1% at the time of writing.

The White House was forced a few days ago to postpone the general meeting of shareholders of the USA semiconductor company to torpedo the maneuver.

This would likely help Chinese competitors such as telecommunications firm Huawei, particularly in the emerging 5G blazing fast wireless internet, where a stronger China could present a national security issue.

5G, or the fifth generation of cellular technology, is seen as a potential game-changer because of its heightened speed, responsiveness and ability to handle a myriad of connected devices.

The decision was unveiled just hours after Hock Tan, the chief executive officer of Singapore-based Broadcom, met with officials at the Pentagon in a last-ditch effort to salvage what would have been the biggest technology deal in history.

"It's a real threat", said James Lewis, a former U.S. national security official who is now vice president at the Center for Strategic and International Studies in Washington.

CFIUS has already blocked a number of takeovers of U.S. corporations since Mr Trump became president and the use by the White House of its report last week, in justifying this decision, suggests it will be used again in the future as part of the President's policy arsenal.

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