Pentagon says memo asking for Broadcom-CA deal review is likely fake

(Reuters) – The U.S. Department of Defense said on Wednesday that a memo purporting to show the Pentagon asking for a national security review of chipmaker Broadcom Inc’s (AVGO.O) $19 billion deal to buy software company CA Technologies (CA.O) was likely fake.

A sign to the campus offices of chip maker Broadcom Ltd, is shown in Irvine, California, U.S., November 6, 2017. REUTERS/Mike Blake

Broadcom said in a statement that the two companies are American, “and there is no basis in fact or law for CFIUS review of our pending transaction.”

The Pentagon is looking into who wrote the fake memo, according to a spokeswoman. She said they considered it likely to be fake based on an initial assessment.

The Committee on Foreign Investment in the United States (CFIUS) is the government panel that reviews deals for potential national security risks. Panel members include representatives of several U.S. departments, including the Department of Defense and the Treasury Department.

Earlier this year, U.S. President Donald Trump blocked Broadcom’s $117 billion hostile bid for semiconductor peer Qualcomm Inc (QCOM.O), arguing it posed a threat to U.S. national security and gave an edge to Chinese companies looking to build next-generation wireless networks.

Since then, Broadcom has redomiciled from Singapore to the United States, placing it formally outside the purview of CFIUS, the government panel that reviews deals for potential national security risks.

Shares of Broadcom were down 2.3 percent at $239.00 and those of CA slipped 1.6 percent at $43.28.

Broadcom announced the deal to buy CA Technologies in July.

Several media reports on Wednesday said U.S. Senator Rand Paul had called for a review of the deal. Paul did not respond to requests for comment.

Reporting by Munsif Vengattil and Sonam Rai in Bengaluru; Editing by Arun Koyyur and Susan Thomas

Reem Nori