News Worms
News Worms

Broadcom offers to buy Qualcomm in $130 billion deal

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. However, according to the FT, Qualcomm is set to reject the deal, raising the prospect of a fight for the future of the company.

"We believe the combination could create shareholder value through potential accretion, synergies, increased share with Apple and Samsung; in addition, Broadcom could potentially settle the licensing dispute with Apple in a more-timely manner than could Qualcomm, given Broadcom's strong relationship with Apple".

Both companies now supply Apple with wireless chips and patent licenses, and the deal would make Broadcom the world's third-largest chipmaker after Intel and Samsung. As a result of all that, its stock has fallen steeply, making it a much better bargain than it was just a year ago - Broadcomm's offer now represents a 30 percent premium over the current stock price.

A Qualcomm spokesman contacted by TechCrunch declined to comment on Broadcomm's proposal at this time. Here's a wrap of what they've said so far.

Hock Tan, president and CEO of Broadcom, said in a statement: "This complementary transaction will position the combined company as a global communications leader with an impressive portfolio of technologies and products".

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.

We would not make this offer if we were not confident that our common global customers would embrace the proposed combination.

The bid comes as Broadcom plans to move its headquarters to the United States from Singapore.


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