Qualcomm turns down Broadcom's takeover bid; this could be the start of an epic Wall Street battle

Qualcomm turns down Broadcom's takeover bid; this could be the start of an epic Wall Street battle
As expected, Qualcomm this morning said no to the largest tech takeover bid in history. Fellow chipmaker Broadcom had offered $60 in cash and $10 in stock for each Qualcomm share, a transaction valued at $105 billion. Qualcomm told stockholders to reject the tender offer, stating that it amounts to Broadcom trying to buy it on the cheap. Despite the rejection, there are still ways that Broadcom can execute an end around past its target's board.

Broadcom is said to be considering a proxy contest, asking Qualcomm stockholders to vote on replacing the latter's current board with a slate of candidates put up by Broadcom. If the proxy is successful, the new board would vote in favor of the acquisition. Another strategy that Broadcom could try would be to raise the bid price. Wall Street believes that Qualcomm's rejection is just the beginning of this battle, not the end. That's why Qualcomm's stock is up as of Monday afternoon by 2.28%, or $1.48, to $66.05.


If the deal ultimately succeeds, Broadcom will be the third largest semiconductor provider in the world after Intel and Samsung. Qualcomm has its chips in the vast majority of smartphones in use today. In addition to providing the majority of Android handsets with its Snapdragon chipsets, it also is the source of modem chips on CDMA flavored Apple iPhone units (Intel provides the component for GSM models). However, with bad blood brewing between Qualcomm and Apple, there is speculation that the former's modem chips will not be employed by Apple on the 2018 iPhone models.

source: Bloomberg

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11 Comments

1. Eclectech

Posts: 346; Member since: May 01, 2013

I'm not crazy about some of the moves Qualcomm has made. That said, Broadcom needs to keep their nasty, opportunistic fingers off of them. ..and Google should watch these proceedings closely, stepping in, if needed, for the sake of their own products future viability.

2. SIGPRO

Posts: 2815; Member since: Oct 03, 2012

Why should Google step in? They are not a watching authority or above other companies! And for their products sake....there are more companies that sells chips etc etc

3. Subie

Posts: 2349; Member since: Aug 01, 2015

I'm not in favor of Broadcom taking over Qualcomm either. But please elaborate further on why you think Broadcom owning Qualcomm would be bad for Google.

10. vincelongman

Posts: 5677; Member since: Feb 10, 2013

Less competition and innovation, bad for consumers in general Avago Technologies bought Broadcom, but are using Broadcom's name, why? Well because they have a bad rep for buying other companies and cutting R&D to maximise profits If Broadcom/Avago bought Qualcomm, they would likely cut R&D spending Which would be bad for Android given Qualcomm are one of the main innovators for Android SoCs (along with ARM, Samsung and Huawei)

4. PhoneCritic

Posts: 1354; Member since: Oct 05, 2011

I would really like Broadcom to purchase them and hopefully work a new Deal with Samsung for manufacturing and allowing Samsung to sell its Exynos chips here in the us l so that those who favor Samsung devices could have a choice between Samsung devices that use the SD SoC or the Exynos SoC. But thats a pipe dream that wont materialize any time soon.

9. microsoftnokiawin

Posts: 1268; Member since: Mar 30, 2012

broadcomm is way worst than QUALCOMM don't think for a second they'd anything like that !

11. vincelongman

Posts: 5677; Member since: Feb 10, 2013

Samsung has a choice They are choosing to not go exclusive with Exynos since its cheaper the 835 is better If anything, Broadcom/Avago would likely try make it harder for Samsung Avago have a bad rep for buying a company for their IP and using that IP to sue others

5. piyath

Posts: 2445; Member since: Mar 23, 2012

All this happened because Qualcomm offended the almighty God himself, Apple. They should know their place in this smartphone business. If not they will not survive. I'm sure eventually Qualcomm will be bought by somebody as they are in a very bad financial state at the moment.

6. BlackhawkFlys

Posts: 908; Member since: May 07, 2014

lolzzz

7. Phullofphil

Posts: 1761; Member since: Feb 10, 2009

Apple has nothing to do with this.

8. Back_from_beyond

Posts: 1373; Member since: Sep 04, 2015

You need help, buddy.

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