Qualcomm to reject Broadcom's huge $103 billion takeover bid

Mindy Sparks
November 13, 2017

US chipmaker Qualcomm is preparing to fend off a bid from rival Broadcom Ltd.to take over the company for about $105 billion.

The source said Qualcomm's board of directors could huddle up on Sunday to examine the unsolicited acquisition bid and think of its strategy.

CEO Steven Mollenkopf and many shareholders feel that the $70 per share bid undervalued the company and didn't account for regulator risks.

The rumors of a Qualcomm takeover started a week ago with a huge $103 billion deal from Broadcom, but now Reuters is reporting that Qualcomm's board is planning to reject the offer. The sources said Broadcom was preparing to submit a slate of directors by Qualcomm's December 8 nomination deadline. Qualcomm's Board of Directors is rumored to have met today and there is speculation that the company will call the offer inadequate in an announcement to be made tomorrow.

Broadcom may raise the bid through debt financing and other means, but their move in that direction is unclear.

Neither company has commented on the report, but it wouldn't be shocking if Qualcomm held out.

Qualcomm delivers chips to carrier networks to provide broadband and mobile data. It is engaged in a patent infringement dispute with Apple Inc, and is also trying to close its $38 billion acquisition of automotive chipmaker NXP Semiconductors NV after signing a deal in October 2016. Broadcom has shown its willingness to buy Qualcomm regardless of whether it closes the NXP deal. Qualcomm shares closed at $64.57 on Friday, while Broadcom ended at $264.96.

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