Saturday, 22 September 2018
Latest news
Main » Qualcomm rejects Broadcom's $103-billion takeover proposal

Qualcomm rejects Broadcom's $103-billion takeover proposal

15 November 2017

Qualcomm has moved quickly to rejected rival Broadcom's $130bn takeover bid, claiming that it "dramatically undervalues" the company, but hinted that a significantly raised offer might be accepted.

The company said its offer of 70 dollars per share represents a 28 percent premium over the closing price of Qualcomm's common stock on November 2, 2017, the last unaffected trading day prior to media speculation regarding a potential transaction, and a premium of 33 percent to Qualcomm's unaffected 30-day volume-weighted average price.

The general opinion among the shareholders is that Broadcom's USD$70-per-share bid doesn't quite capture the company's current value, and does not take into consideration the uncertainty that goes along with processing a transaction this huge.

More news: Election Commission bars BJP from using the term 'Pappu' in Gujarat elections

In a statement, Paul Jacobs, executive chairman and chairman of the board of Qualcomm, said: "It is the board's unanimous belief that Broadcom's proposal significantly undervalues Qualcomm relative to the company's leadership position in mobile technology and our future growth prospects".

Tan said he's pleased with the reaction he's already received from Qualcomm shareholders and customers regarding his proposal and would prefer to keep the negotiations friendly. "We continue to believe our proposal represents the most attractive, value-enhancing alternative available to Qualcomm stockholders". The deal would dwarf Dell Inc.'s $67 billion acquisition of EMC in 2015 - then the biggest in the technology industry.

According to Reuters, Broadcom could increase its offer to up to $90 per share.

More news: World's 'most beautiful' diamond sold at auction for £25.5m

But whether Broadcom is willing to make an offer Qualcomm can't refuse still isn't clear.

Any deal would face scrutiny from the antitrust regulators as the combined company would own the high-end WiFi business globally, analysts said.

According to sources familiar with the ongoing deliberations, Qualcomm's board of directors could meet over the weekend to decide on what steps to take regarding Broadcom's unsolicited acquisition offer.

More news: Endo International PLC (ENDP) Releases Q3 Earnings Guidance

Qualcomm rejects Broadcom's $103-billion takeover proposal