Qualcomm has rejected Broadcom's $130 billion 'unsolicited proposal'

Nov 14, 2017, 00:39
Qualcomm has rejected Broadcom's $130 billion 'unsolicited proposal'

Qualcomm said that, after a comprehensive review of the offer, its board unanimously concluded that the $70-a-share proposition "significantly undervalues" the chipmaker giant.

Qualcomm said the decision to reject Broadcom's offer was unanimous.

Analysts said Broadcom could easily raise its bid to $80 or $90 per share-or as much as $130 billion-and still make out well with the acquisition.

Hawk Tan, the Chief Executive at Broadcom, said in an announcement that this integral exchange will put the joined undertaking as a pioneer in the worldwide correspondence advertises with an unbelievable arrangement of items and advancements.

Qualcomm CEO Steve Mollenkopf added that the U.S. chip maker has a future in mobile, the Internet of Things (IoT), edge computing and networking within the semiconductor industry, and the firm has no doubt of future growth in these areas. "We continue to believe our proposal represents the most attractive, value-enhancing alternative available to Qualcomm stockholders and we are encouraged by their reaction", the company said.

This comes shortly after Qualcomm filed another lawsuit against its main chip purchaser, Apple, claiming that it broke a confidentiality clause found in its contract. Qualcomm announced today it has rejected Broadcom's takeover bid, and for now, it will remain subsidiary to no one. "We are highly confident that the strategy Steve and his team are executing on provides far superior value to Qualcomm shareholders than the proposed offer", said Tom Horton, Presiding Director for Qualcomm Incorporated.

Both semiconductor companies did not immediately respond to requests for comment.

Like Qualcomm, Broadcom is a major supplier of parts of Apple products. Under Broadcom's proposal, Qualcomm stockholders would receive per share and it will consist of $60.00 in cash and $10.00 per share in Broadcom shares.

Singapore-based Broadcom made the offer last week in what would have consolidated two major players in the booming sector fueled by growth in smartphones and other connected devices.