Qualcomm asks Broadcom over for lunch and a proper chat about being bought

Brushes off latest $121bn bid as too low, too risky, but is willing to discuss deal

By Simon Sharwood


Qualcomm has rejected Broadcom's latest attempt to buy it, but has also said it is willing to discuss doing a deal.

That's a change from the position the company adopted after Broadcom offered US$103bn to buy Qualcomm in November 2017. At the time Qualcomm's response to Broadcom rejected the offer and said nothing about how the deal might be done.

Earlier this week Broadcom increased its bid to $121bn.

Qualcomm's again rejected the bid, but its statement also offers the following lifeline:

Qualcomm has offered to meet with Broadcom to see if it can address the serious deficiencies in value and certainty in its proposal.

At any such meeting, Qualcomm have two questions for Broadcom.

The first is "What is the true highest price at which you would be prepared to acquire Qualcomm? Is it $82 per share or is it higher?" and would be asked because Qualcomm thinks Broadcom has undervalued its current business by not taking into account it recent acquisition of NXP and the likely future rivers of revenue to flow from 5G.

The second question asks "Is Broadcom willing to commit to take whatever actions are necessary to ensure the proposed transaction closes?" That one's on the table because Qualcomm doesn't want to get half-way into a tricky deal and then have to rebuild itself as an independent company.

Broadcom's last offer to Qualcomm was labelled a "Best and Final Offer". At the time of writing, Broadcom's web page, regulatory filings and social media accounts were silent on its attitude to Qualcomm's invitation. If that changes, The Register will let you know. ®

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