Comcast's recent stock slide increases the odds the company will back off on its interest in either Fox or Sky, MoffettNathanson analyst Craig Moffett wrote investors Wednesday. It said investor bearishness on Comcast stock after its bid for Sky reflects a variety of issues, including fears that cash from the cable business would be increasingly diverted to other lines of business, and that the Sky bid reflects a Comcast desire to diversify away from its core cable business that has few growth prospects. It said a key issue is whether Comcast sees Fox as optional or vital for its interest in becoming a global media operator. It said it's increasingly doubtful Comcast pursues Fox even if the U.S. v. AT&T and Time Warner outcome is favorable toward a vertical deal. Comcast didn't comment.

The Committee on Foreign Investment in the U.S. won’t say if it has an interest in reviewing or blocking Foxconn’s proposed $866 million Belkin International buy (see 1803270004), a Treasury spokeswoman emailed us Tuesday. “By law, information filed with CFIUS may not be disclosed by CFIUS to the public,” she said. “Accordingly, the Department does not comment on information relating to specific CFIUS cases, including whether or not certain parties have filed notices for review.”

Foxconn’s Interconnect Technology subsidiary will buy Belkin and its Linksys, Wemo and Phyn product brands for $866 million in cash under a “definitive agreement” signed and announced Monday. Belkin sees the acquisition as accelerating its “vision” of delivering accessories for the “premium” smart home space, said CEO Chet Pipkin, who will remain in that post and will join Foxconn’s management team. “We see significant synergies” with Foxconn, including “leveraging its world-class manufacturing capability to enhance Belkin’s operating efficiency and competitiveness,” said Pipkin. “The transaction also grants us access to more resources to invest in our people and to aggressively pursue opportunities in the marketplace.” Foxconn recently completed a contract under which it would collect nearly $3 billion in cash credits from Wisconsin if it builds a huge LCD display fab in the state’s Racine area and hires a big workforce there to run the project (see 1711130014). Belkin declined comment Tuesday whether it worries that Foxconn’s proposed buy will trigger Trump administration pushback on the same national security grounds on which it quashed Broadcom’s hostile takeover of Qualcomm because of Broadcom's huge interests in China. Foxconn, though officially headquartered in Taiwan, is China’s largest private-sector employer. “At this time, the announcement serves as our official comment,” emailed Belkin spokeswoman Jen Warren. Foxconn didn’t comment, nor did representatives of the Committee on Foreign Investment in the U.S., on whose recommendation President Donald Trump signed the executive order blocking Broadcom/Qualcomm (see 1803120060).

Four members of the British Parliament urged the U.K. Competition and Markets Authority (CMA) to block Fox's bid for Sky. In a letter Thursday, the four said that Comcast also is bidding for Sky (see 1802270011) undercuts the threat Sky raised that without a Fox deal, it might have to close Sky News (see 1711080003). They said it would be very difficult to craft effective behavioral conditions to ensure Fox doesn't influence Sky News and to create a means for monitoring such conditions. Signing the letter were Ed Miliband, Vince Cable, Kenneth Clarke and Charles Falconer. The CMA in January issued a preliminary finding that a Fox buy of Sky may not be in the public interest regarding media plurality (see 1801230010). Fox didn't comment Friday.

CSRA, providing cybersecurity to the government and others, got a rival, higher takeover bid that was an unsolicited proposal from CACI, which also provides cybersecurity. But original buyer General Dynamics said it will carry on with its all-cash $9.6 billion deal. Although about 8 percent more on a per-share basis, CACI's offer isn't all cash. CACI sees $165 million annually in cost savings, more than with GD. The antitrust waiting period under the Hart-Scott-Rodino Act has expired, said GD. CSRA's board, "in consultation with its legal and financial advisors, will carefully review and consider" the new bid, the acquiree said: The board hasn't "changed its recommendation that CSRA stockholders tender their shares of CSRA common stock pursuant to the Offer" from GD. After Sunday's developments, CSRA stock closed up 0.9 percent Monday at $41.02.

The Committee on Foreign Investments in the U.S., on whose recommendation President Donald Trump blocked Broadcom’s proposed Qualcomm buy on national security grounds (see 1803140057), faces workload challenges that may threaten “its ability to fulfill its objectives and address national security concerns,” GAO reported Friday. CFIUS “staff levels may not be sufficient to complete committee functions” because “the volume of transactions reviewed” increased more than 50 percent 2011-2016 with no corresponding increase in employees assigned to do the work, said GAO. Adding to that pressure was the growing “complexity of those reviews in terms of technology, transaction structure, and national security concerns,” it said. The Treasury Department, “as CFIUS lead,” needs to better coordinate efforts at the committee's 10 member agencies to bolster understanding of "the staffing levels needed to address the current and projected CFIUS workload associated with core committee functions,” it said. Treasury, in written comments for the report, said it’s working with the Office of Management and Budget “to determine current resource levels across the CFIUS member agencies and has encouraged agencies to assess their staffing needs,” it said. However, “Treasury noted that CFIUS does not have a centralized budget, and Treasury does not have the authority over CFIUS staffing levels at member agencies.”

Ex-CEO/Chairman Paul Jacobs told the board "he has decided to explore the possibility of making a proposal to acquire Qualcomm," the wireless/intellectual property company announced Friday evening. It said he won't be renominated for the board at this coming Friday's annual meeting. "Following the withdrawal of Broadcom’s takeover proposal, Qualcomm is focused on executing its business plan and maximizing value for shareholders as an independent company," it said. "There can be no assurance that Dr. Jacobs can or will make a proposal, but, if he does, the Board will of course evaluate it consistent with its fiduciary duties to shareholders." Also last week, Broadcom pulled its bid after President Donald Trump blocked the potential deal, which the would-be acquiree had been rebuffing (see 1803150060).

DOJ's slight shift on theory in its AT&T/Time Warner litigation gives it an easier argument (see 1803150030), possibly reducing the stakes, American Enterprise Institute Visiting Fellow Daniel Lyons blogged. Justice initially argued New AT&T would be able to raise consumer prices by making rivals pay more for TW content; now it's focusing on the costs to AT&T competitors, since the government's expert found merger efficiencies are likely to reduce AT&T subscriber pricing, Lyons said. Meanwhile, AT&T dropped its selective prosecution arguments, in which it claimed it was being singled out because of Trump administration antipathy to CNN, since the court signaled skepticism, he said. One must for the government is to show its estimated increase in rivals' subscriber prices -- 45 cents per month -- is significant enough to constitute harm to competition, he said. He said DOJ could face difficulty in proving New AT&T would have incentive to coordinate with Comcast and "may have a path to victory" since Judge Richard Leon of Washington also presided over the 2011 Comcast/NBCUniversal and thus is familiar with the government's theory in the case, he said. Also Friday, telecom lawyer/consultant Jonathan Lee criticized DOJ's case as not reflecting contemporary video distribution business realities. Being an MVPD "simply isn't as profitable as [the agency] seems to remember," and MVPDs now lack the ability to pass on programming price increases without losing customers, Lee blogged. He said DOJ arguments that New AT&T will be able to raise prices ignores that blackouts are on the rise, which indicates MVPDs are far less willing to accept programmers' price demands, and declining subscriber numbers show customers reject current price levels. The trial is to begin Monday and is expected to last 15 days (see 1803080047).

Though Broadcom formally ended its bid to buy Qualcomm Wednesday and complied with President Donald Trump’s order to withdraw its slate of nominees for election to the Qualcomm board (see 1803140057), Broadcom’s “understanding” is that Qualcomm’s own nominees running for the board at the company's March 23 annual meeting "are only garnering between 15 to 16 percent" of the total Qualcomm shares outstanding in a proxy vote “tally” through Thursday, said Broadcom Chief Financial Officer Tom Krause on a Thursday earnings call. That’s “not necessarily something to celebrate down in San Diego,” said Krause in an obvious jab at Qualcomm’s management, which fought for months to beat down Broadcom's hostile takeover bid. Qualcomm representatives didn’t comment. Broadcom doesn’t see “this week’s events putting any constraints on our ability to pursue acquisitions more broadly,” said Krause. He and CEO Hock Tan “are quite familiar with the industry landscape, and sitting here today, we do see potential targets that are consistent with our proven business model,” he said. Qualcomm was “clearly a unique and very large acquisition opportunity,” he said. “Given the maturity of the industry” and the “consolidation it has seen,” any future Broadcom acquisitions “are much more likely to be funded with cash available on our balance sheet,” rather than financed through banks, he said. Broadcom executives refused to take questions on the call about the failed Qualcomm bid.

U.S. District Judge Richard Leon of Washington denied a sealed DOJ motion to preclude defendants AT&T and Time Warner from presenting at trial evidence of its "baseball-style" arbitration offer, which Wells Fargo analyst Jennifer Fritzsche wrote investors Wednesday is a positive sign for the deal. An unsealed version of the motion (in Pacer) filed Tuesday said conditions offered after Justice sued to block the telco buying TW (see 1711280063) don't change the structure of the proposed deal and are inconsistent with the structural focus of the Clayton Act and irrelevant. Leon's docket 17-2511 minute order (in Pacer) Tuesday also denied a motion by a group of former DOJ officials seeking to file an amicus brief in the department's lawsuit (see 1803090022). The order didn't give reasons for the actions. Watchdog group Protect Democracy Project, representing the former DOJ officials, didn't comment Wednesday.