China's market regulator has launched an investigation into Qualcomm Technologies’ acquisition of Israeli computer chip designer Autotalks in July.
The State Administration for Market Regulation (SAMR) said Qualcomm was suspected of violating China’s anti-monopoly law.
“Because Qualcomm failed to declare the concentration of operators in accordance with the law when acquiring Autotalks, and was suspected of violating the Anti-Monopoly Law of the People's Republic of China, the State Administration for Market Regulation has initiated an investigation into Qualcomm in accordance with the law,” SAMR said in a statement translated into English.
Qualcomm did not disclose the size of the acquisition of Autotalks, which describes itself as a pioneer in vehicle-to-everything (V2X) communication solutions and manufactures chips to help prevent car crashes.
Although the deal does not directly involve its entities, China is concerned that the buy may limit its access to technologies in V2X, which it sees as a strategically important sector.
The purchase comes at a sensitive time for the relationship between the United States and China, which are fighting for market dominance in the semiconductor trade and threatening to impose punishing tariffs on each other.
Qualcomm shares (NASDAQ: QCOM) closed down US$12.15 (7.33%) at $153.52 on Friday (Saturday AEDT), capitalising the company at $165.46 billion (A$254.2 billion).
