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Broadcom plans Qualcomm bid according to sources

07 November, 2017, 00:36 | Author: Paula Vaughn
  • Chipmaker Broadcom seeks to acquire Qualcomm

According to sources Qualcomm is not aware of the details of Broadcom's bid and the company has yet to make any comment.

Qualcomm and Broadcom have patent portfolios in wireless communications that are largely adjacent to each other, and antitrust concerns over any proposed deal could be muted because the companies have few areas of overlap beyond Wi-Fi solutions for wireless routers, Bluetooth drivers and some RF semiconductors.

Broadcom has reportedly made an unsolicited offer to buy Qualcomm in a deal valued at $130 billion, which, if it succeeds, would be the largest acquisition in tech history.

Qualcomm's chips and patents affect nearly every smartphone model in the world, and Broadcom is offering $70 a share, which is a 28pc premium on Qualcomm's closing stock price last Thursday (2 November) according to a report in The New York Times.

In a statement, the company said: "Qualcomm Board of Directors, in consultation with its financial and legal advisors, will assess the proposal in order to pursue the course of action that is in the best interests of Qualcomm shareholders".

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The deal represents a 28% premium to Qualcomm's share price prior to rumors of the deal which sent the stocks higher last week.

Broadcom today (6 November) revealed a $105bn takeover bid for Qualcomm, a move that would see the creation of a giant in the chip-making world. The company has gone so far with its Apple fight that it recently filed a lawsuit seeking to ban sales of the iPhone in China.

Such a massive deal has the potential to invite scrutiny from regulators, but Broadcom CEO Hock Tan said in a letter to Qualcomm that he was confident that the transaction would not raise any red flags for antitrust enforcers.

If the offer is accepted, it could indeed push the new company into serious competition with semiconductor leaders Intel and Samsung.

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