For years, Taiwan-based Foxconn has been best-known for manufacturing Apple products, but it also builds countless other consumer electronics. Today, one of the company’s subsidiaries (Foxconn Interconnect Technology) announced it is purchasing US-based Belkin for $866 million in cash. Belkin owns a number of major brands, including Linksys and Wemo.
The buyout would make Foxconn a major player in consumer electronics, instead of just a contract manufacturing company. Belkin primarily sells phone/tablet accessories, but also manufactures networking equipment like routers and Wi-Fi range extenders. The company also sells a range of smart home products under the Wemo brand, like the smart switches we reviewed earlier this year.
According to The Financial Times, the purchase is subject to approval from the US Committee on Foreign Investment. In other words, there is a very real chance the acquisition could be blocked. President Trump blocked Broadcom’s acquisition of Qualcomm earlier this month, based on advice from the committee.
Belkin’s router business is likely to gather scrutiny from government officials, especially since they aren’t particularly secure to begin with. Foxconn pledged to build a $10 billion factory in Wisconsin last year, which could help seal the deal, but that agreement has also drawn criticism. The state provided Foxconn over $3 billion in incentives, and allowed the company to skip environmental impact studies.