Qualcomm, the largest chipmaker in the world has once again rejected a revised $121 billion takeover bid from Broadcom but offered to meet the Singapore-based firm to discuss the recently increased offer.
Broadcom had offered to acquire Qualcomm‘s all outstanding shares at $82 per share. But the chipmaker said that the offer from Broadcom “materially undervalues the company”. Broadcom had previously offered the world’s largest maker of chips and processors for phones, $70 a share, or $105 billion. Qualcomm rejected the offer saying the price tag wasn’t high enough.
Qualcomm Chairman Paul Jacobs addressed concerns about the deal falling through. He said, “If you are not willing to agree to do whatever is necessary to ensure a transaction closes, we will need you to be extremely clear and specific about exactly what actions you would refuse to take so that we can properly evaluate the risk to Qualcomm’s shareholders.”
“What is the true highest price at which you would be prepared to acquire Qualcomm? Is it $82 per share or is it higher?” Jacobs said. The letter said the bid “ascribes no value” to NXP or Qualcomm’s plans to roll out new devices for the fifth generation of wireless networks known as 5G.
“Your proposal is inferior relative to our prospects as an independent company and is significantly below both trading and transaction multiples in our sector,” the Qualcomm chairman wrote.