Broadcom bids $130 Billion to acquire Qualcomm

Broadcom bids $130 Billion to acquire Qualcomm

It was not clear who Broadcom was referring to, but Apple is Qualcomm's biggest customer.

"It's a smart move that would make Broadcom into a tech juggernaut", said GBH Insights analyst Daniel Ives.

The offer came after Broadcom chief executive Hock Tan appeared with President Donald Trump last week and announced the company is likely to relocate its headquarters from Singapore to the US.

On Monday, Qualcomm's shares were up 3 percent at $63.71 in morning trading, suggesting that investors were skeptical a deal would happen.

Qualcomm said it would review the proposal.

Qualcomm is now trying to close its pending $38-billion acquisition of NXP Semiconductors, a leading supplier of chips for vehicles that is also expanding into self-driving technology, and it is believed that Broadcom is open to acquiring NXP. It has pulled off a string of purchases over a decade.

More news: Kamal Haasan can not be silenced through threats: Pinarayi

Herbert Hovenkamp, who teaches antitrust at the University of Pennsylvania Law School, said that U.S. regulators would try to ensure the deal would not lead to higher chip prices.

Any deal struck between the two companies would face intense regulatory scrutiny. Broadcom also got a commitment letter for US$5 billion in financing from private equity Silver Lake Partners, an existing Broadcom investor. The Broadcom proposal stands whether Qualcomm's pending acquisition of NXP Semiconductors N.V. ("NXP") is consummated on the now disclosed terms of $110 per NXP share or the transaction is terminated.

If Broadcom decides to make a hostile bid, Qualcomm's governance rules would allow the rival to submit its own slate for the entire 10-member board by a Dec 7 nomination deadline.

Industry analysts believe that if Apple does not challenge the deal, it's one hurdle that Broadcom will have cleared.

Tan will be in NY and Boston this week for meetings with Qualcomm shareholders, according to people familiar with the matter.

Semiconductor vendor Broadcom is on the verge of making a $130bn (£99bn) bid for chip maker Qualcomm in what would be the largest technology takeover ever, according to reports.

Related Articles