Broadcom to relocate back to America
Move will bring $27 billion to US
Singapore-headquartered US chipmaker Broadcom is re-locating its legal home address back to the US - a move it believes will enhance shareholder value.
Changing Broadcom's parent from a Singapore company to a US corporation is expected to bring US$20 billion (S$27.3 billion) in revenue back to the US, said President Donald Trump, who made the announcement on Thursday at a White House press conference.
Broadcom chief executive Tan Hock Eng, who attended the briefing, said a tax reform proposal put forward by the Republicans will make the US a friendlier place for business.
Mr Tan said in a statement: "We expect the tax reform plan effectively to level the playing field for large multinational corporations headquartered in the United States and to allow us to go all in on US re-domiciliation."
The move will take place regardless of whether the plan passes, the company said.
The re-domiciling, which has to be approved by shareholders, will reportedly also facilitate Broadcom's US$5.9 billion takeover of US network provider Brocade Communications Systems.
The deal, announced in November last year, has been delayed due to scrutiny by the Committee on Foreign Investment in the US, which reviews the national security implications of foreign investments in American companies.
Becoming a US-based company might help Broadcom avoid these regulations and push the deal through.
The Nasdaq-listed Fortune 500 company was acquired by Singapore-based Avago Technologies in a US$37 billion deal completed last year. The combined company became the third-largest US semiconductor maker by revenue, behind Intel and Qualcomm.
Broadcom, a major supplier to Apple, logged US$13.2 billion in revenue globally for the year ended Oct 30 last year.
Its presence in Singapore includes its corporate co-headquarters in Yishun as well as facilities in Depot Road and North Coast Drive, according to the company's website.
Broadcom had about 15,700 employees worldwide as of October last year, the company's annual report last year said.
Responding to the move, the Economic Development Board's director for electronics Pee Beng Kong said Broadcom's leadership team has always been based in the US.
"We understand that Broadcom's operations in Singapore, which include manufacturing and research and development, will remain unchanged and will not be affected by this move."
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