Applied Materials drops bid for Kokusai Electric

US chipmaking equipment company Applied Materials has dropped its bid to buy Japanese rival Kokusai Electric. Analysts say the intensifying competition for tech supremacy between the US and China may have played a role.

Applied Materials announced in 2019 it would buy Tokyo-based Kokusai Electric for 2.2 billion dollars.

But the company said on Monday it couldn't meet the deadline to complete the deal. It said it didn't get timely approval from Chinese regulators.

This comes as relations worsen between China and the US over development and production of semiconductors.

Beijing has set a goal of producing more of its chips domestically. Washington, meanwhile, has banned exports of chipmaking devices to China.

President Joe Biden signed an executive order in February to raise domestic production of semiconductors. The US also wants to build stronger supply chains with its allies.