A semiconductor company worth $100 billion currently based in Singapore has decided to relocate its home address to the U.S. announced President Donald Trump on Thursday.
Broadcom Limited makes communication chips across the globe and said on Thursday it would be relocating its domicile address to the U.S. once the move has been approved by shareholders.
The move will bring annual revenue of $20 billion back to the United States. The move allows Broadcom to avoid a federal review process as well.
The White House announcement came during the release of the tax reform proposal of the Republicans, which would reduce drastically the corporate tax rates and would make it much easier to deduct foreign taxes.
Broadcom credited the plan by the GOP with making it much easier to carry out business in the U.S. Hock Tan the CEO at Broadcom said that once again America is the best place for leading a business that has a global footprint.
However, the move by Broadcom back to the U.S. is going to take place whether the tax plan passes or not for the Republicans, company executives announced.
The White House did not explain its claim the move would bring annual revenue of $20 billion into the U.S. Its global annual revenue mostly recently reported was only $13.2 billion.
Last year, Broadcom entered into an agreement of $5.5 billion to merge with Brocade Communications Systems, which is a network provider in the U.S. However, that merger has been delayed due to being scrutinized by the committee in the U.S. known as the Committee on Foreign Investment in the U.S.
The government committee, know more familiarly as CFIUS, carries out investigations of proposed acquisitions of companies based in the U.S. by buyers outside the U.S. on the grounds of intellectual property and national security.
By moving its domicile address to the U.S. to become a legitimate U.S. based business, Broadcom will avoid the scrutiny of CFIUS. The corporate headquarters for Broadcom will be in San Jose, California.
Broadcom is a manufacturer of semiconductor chips that are used in a variety of different products, from smartphone to cable set-top boxes and other devices.
Nearly 20% of Broadcom’s revenue for its most recent quarter was from sales to iPhone maker Apple and contractors that make Apple’s products, including Foxconn.
Close to 50% of its overall revenue was generated from manufacturers and distributors in China though the products in the end are used worldwide.