Broadcom raises Qualcomm bid to $120 billion
- Author: Terrell Bush Feb 06, 2018,
Feb 06, 2018, 13:52
Qualcomm (San Diego) said in a statement that it's board would review Broadcom's proposal with legal and financial advisors.
Qualcomm responded that its board of directors would review the latest offer, and declined to comment further until then.
In its attempt to take over Qualcomm, semiconductor company Broadcom has proffered a "best and final offer" of $121 billion Dollars, which would be the largest tech acquisition in history if accepted.
Broadcom has made what it says is its "best and final" bid to acquire all of the outstanding shares of common stock of Qualcomm Incorporated.
Qualcomm is also in the process of its takeover attempt of NXP Semiconductors for $38 billion or $110 per share. The additional $12 comes Broadcom shares. So on Monday, when Broadcom upped its offer to $82 a share, a lofty level that Qualcomm has only reached in three days out of its entire 26-year history as a public company, investors surely would be more interested? "We will withdraw this proposal and cease our pursuit of Qualcomm immediately following your upcoming annual meeting unless we have entered into a definitive agreement or the Broadcom-nominated slate is elected". Finally, Royal Bank of Canada reaffirmed a "top pick" rating and set a $285.00 price objective on shares of Broadcom in a research report on Wednesday, October 11th.
Broadcom also plans to offer Qualcomm a higher-than-usual breakup fee in the event regulators thwart the deal, according to the sources. This dispute negatively impacted Qualcomm's Q1 2018 earnings, in which operating income was down 96% year-over-year and down 91% since Q4 2017. That remains the company's focus unless Qualcomm agrees to negotiate, Tan said.
Yes, Qualcomm's board of directors promptly said "no thank you," to that offering, noting at the time that they felt Broadcom's offer "severely undervalued" their company.
In other Broadcom news, SVP Bryan Ingram sold 794 shares of the stock in a transaction that occurred on Wednesday, December 6th.
NXP shareholders, led by activist hedge fund Elliott Management Corp, are resisting the deal, pushing for Qualcomm to raise its offer.
Patrick Moorhead, president and principal analyst at Moor Insights & Strategy, said Broadcom had to increase its bid after Qualcomm gave a new quarterly forecast that reflected its success in chips used in areas such as automobiles and the internet of things.