Qualcomm’s board of directors ‘unanimously rejects’ Broadcom’s $103 billion offer

Qualcomm issued a formal press release indicating that the company has turned down Broadcom's acquisition offer

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U.S.-based chip manufacturer Qualcomm doesn’t seem interested in joining Broadcom.

The chip manufacturer has issued a formal media release outright rejecting Broadcom’s $103 billion USD acquisition offer. That $103 billion figure is a result of Broadcom valuing Qualcomm at $70 USD per share.

“It’s is the Board’s unanimous belief that Broadcom’s proposal significantly undervalues Qualcomm relative to the company’s leadership position in mobile technology and our future growth prospects,” said Paul Jacobs, Qualcomm’s executive chairman and chairman of the board.

Jacobs’ choice of words is interesting, considering that Qualcomm is currently trading at $65.31 USD on the NASDAQ exchange — almost $5 fewer than Broadcom’s valuation.

Broadcom sent Qualcomm the proposal documents on November 6th, 2017. Both companies have already established that Broadcom’s offer was unsolicited, meaning that neither company had previously discussed this potential acquisition.

According to Broadcom — the company responsible for chips that support Wi-Fi, Bluetooth and NFC on consumer- and professional- smartphones and other mobile devices — its desire to acquire Qualcomm stems from that fact that “Qualcomm’s cellular business is highly complementary to Broadcom’s portfolio.”

Unfazed by rejection

This rejection from Qualcomm most likely won’t stop Broadcom from another acquisition attempt.

According to a Reuters report, Broadcom’s CEO Hock Tan has previously said that he’s open to launching a takeover battle if it means acquiring Qualcomm.

Qualcomm is currently in the process of finalizing a deal for Dutch chip manufacturer NXP Semiconductors — a deal that’s valued at approximately $38 billion USD.

Qualcomm is also currently tied up in a series of legal battles with Cupertino computing giant Apple, over the pricing of mobile chips, and the two companies might end their relationship before next year’s iPhone release.

Source: QualcommReuters

Update 15/11/17: This story erroneously reported that Broadcom was in the process of finalizing a deal for NXP Semiconductors. In fact, it is Qualcomm that is in the process of deal-making with NXP.