US-based chipmaker Qualcomm announced it signed component deals with three Chinese smartphone makers – Xiaomi, Oppo and Vivo – valued at $12 billion on the sidelines of US President Donald Trump’s state visit to Beijing.
Qualcomm, which earns more than half of its revenues in China, said in a statement it signed non-binding memorandum of understanding (MoUs) with the three handset makers, which expressed interest in purchasing components valued at no less than $12 billion over the next three years.
The MoUs were signed at a ceremony at the Great Hall of the People in Beijing led by China President Xi Jinping and Trump. Qualcomm CEO Steve Mollenkopf was part of President Trump’s Department of Commerce Trade Delegation to China.
Mollenkopf said Qualcomm has longstanding relationships with Xiaomi, Oppo and Vivo, adding “we are continuing our commitment to investing and helping advance China’s mobile and semiconductor industries.”
The agreement was part of a $250 billion package of deals unveiled between US and Chinese firms during Trump’s first state visit to China, Reuters reported.
Qualcomm is the target of a takeover by Broadcom which earlier this week made a $130 billion bid to acquire the rival chipmaker. A deal would be the biggest ever struck for a technology company and one of the largest of all time. The transaction is worth $70 per share in cash and stock and includes proposals to clear Qualcomm’s $25 billion of net debt. Broadcom said it will honour a deal regardless of whether Qualcomm’s pending acquisition of NXP Semiconductors is approved.
Qualcomm is also involved in a legal dispute with Apple which took legal action earlier in the year over licensing and royalty payments, arguing the chipmaker is abusing its position and overcharging.