Qualcomm rejects Broadcom’s $105B takeover bid

By : |November 15, 2017 0

Qualcomm has rejected Broadcom’s huge $105 billion takeover bid. The reason for the rejection is that Qualcomm’s board believes that the offer significantly undervalues the company. Broadcom’s offer was for $70 a share- valuing Qualcomm just north of $100 billion.

“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,” said Paul Jacobs, executive chairman and chairman of the board of Qualcomm.

Broadcom said in its statement that it remains fully committed to the acquisition and that combining the companies would create a strong and global company with an impressive portfolio of industry-leading technologies and products.

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The deal could hinge on Qualcomm’s resolving its conflict with Apple that has been going on for the past year. Apple recently put an Intel modem in some of the new iPhone models, and that immediately angered Qualcomm. The company demanded royalties for the Intel modems, so Apple sued Qualcomm as a result. After some back-and-forth and Qualcomm reportedly withholding software needed to test its chips in iPhones, Apple may be looking to cut Qualcomm out of the iPhone equation entirely.

Meanwhile, Qualcomm is looking to acquire NXP Semiconductor for $38 billion but regulatory approvals have been delaying the deal.

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