Qualcomm’s planned Autotalks purchase faces EU probe

18 Aug 2023

Image: © Dmitry/Stock.adobe.com

The EU Commission is concerned that the deal could impact EEA competition, as it involves two of the region’s main suppliers of vehicle-to-everything semiconductors.

Qualcomm’s plan to acquire Israeli vehicle chipmaker Autotalks is being investigated by the EU over competition concerns.

The European Commission has informed Qualcomm that the deal cannot proceed until it is assessed and approved by the Commission. Qualcomm announced its plan to acquire Autotalks in May.

Autotalks creates chips to improve road safety by enabling vehicle-to-everything (V2X) communication, which lets vehicles communicate with each other and ‘see’ their environment. The Commission will investigate if the deal will impact competition in the V2X market.

Qualcomm saw its second fiscal revenue fall earlier in the year as multiple divisions reported smaller earnings. But its automotive division saw a 20pc year-on-year increase, which may have motivated Qualcomm to make the acquisition bid.

The cost of the deal was not disclosed, but sources told TechCrunch that Qualcomm will pay between $350m and $400m for the start-up.

The European Commission said the deal did not reach the notification thresholds set out under EU Merger Regulation rules, but seven EU member states requested the Commission investigate the merger. This was followed by requests by eight other countries within the European Economic Area (EEA).

The Commission said that the information available to it “at this early stage” suggests that the transaction meets the criteria for an examination.

“The transaction would combine two of the main suppliers of V2X semiconductors in the EEA,” the Commission said in a statement. “The V2X technology is key to improving road safety, traffic management and reducing CO2 emissions as well as for the deployment of autonomous vehicles.

“It is therefore important to ensure that customers such as original equipment manufacturers or infrastructure managers retain access to V2X technology at competitive prices and conditions.”

Meanwhile, Adobe’s planned $20bn acquisition of Figma is facing a hurdle, as the European Commission launched an in-depth investigation into the deal earlier this month.

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Leigh Mc Gowran is a journalist with Silicon Republic