Taiwan-based OEM and manufacturer Foxconn has announced that it will be acquiring Belkin International, an American consumer electronics manufacturer that specializes in connectivity devices and network system products. The company currently markets products under the Belkin, Linksys and Wemo brands, and all three brands will be a part of the deal. Foxconn is best known as the manufacturing partner for the Apple iPhone line-up, and also handles manufacturing for InFocus, Nokia and Sony Playstation, among others. Also Read - Apple's iPhone maker Foxconn unveils 3 new electric vehicle prototypesAlso Read - Apple iPhone 13 series launch could be delayed due to chip shortage
Belkin was founded in 1983 in California, and develops routers, smartphone accessories, wireless charging systems and other network peripherals. The company acquired the Linksys brand from Cisco in 2013, and also markets smart home systems under the Wemo brand. Foxconn will be acquiring Belkin International and all of its brands for $866 million in a cash deal. However, it’s important to remember that the acquisition will be subject to regulatory approvals by the US government, since the deal involves an American company being acquired by a foreign one. Also Read - Apple to boost iPhone production in India to reduce Chinese dependancy: Report
This is further complicated by the fact that the deal involves an organization that is involved in networking devices, which could raise security concerns for the American government. The Trump administration has recently shown that it is not taking major acquisitions of American companies by foreign ones lightly, and earlier this month issued an order that would interfere with Broadcom’s high profile acquisition attempt of Qualcomm. However, as per a report by The Verge, Foxconn has pledged in 2017 to build a $10 billion factory in the US state of Wisconsin, which will keep the company in the good books of the current US administration. As such, the deal is less important than the Qualcomm-Broadcom one and is likely to go through.
Taiwanese manufacturer Foxconn currently operates primarily as an OEM, using its manufacturing facilities to offer companies such as Apple, Sony and others an outsourced manufacturing solution. However, the company has been heavily dependent on the revenues brought in by the manufacture of the Apple iPhone line-up, which while lucrative currently, could disappear entirely if Apple changes its manufacturing strategy. As a result, the company has been looking to branch out, and the Belkin acquisition is one of these attempts to grow its business. Foxconn also jointly acquired the rights to manufacture Nokia-branded smartphones along with HMD Global back in 2016 from Microsoft.