Qualcomm to stockholders: vote against Broadcom takeover at next annual meeting

As the date for Qualcomm’s annual stockholders meeting creeps nearer, the U.S.-based chip manufacturer has issued yet another letter imploring voting members to reject any action that could lead to a Broadcom takeover.

Qualcomm’s latest letter was included as part of a January 23rd, 2018 media release.

Much like the company’s previous letter, the January 23rd document denounces a Broadcom takeover attempt, while attempting to make a case that the regulatory hurdles caused by such a takeover would far outweigh any potential benefits.

“Even if Broadcom were to make a proposal that delivered fair value to Qualcomm stockholders, the complex regulatory challenges mean that Broadcom would not deliver that value to Qualcomm stockholders for what is likely to be 18 months or more — if ever,” reads an excerpt from the latest letter.

Qualcomm further argues that Broadcom itself has failed to take “the necessary steps to start the regulatory approval process in most countries around the world.”

Should Qualcomm accept Broadcom’s takeover bid, a number of independent, federal-level regulatory agencies would no doubt seek to verify the legality of Broadcom’s takeover.

Qualcomm itself linked to the U.S. Securities and Exchange Commission (SEC) website in its January 23rd media release.

“This is the latest proposed technology transaction in history and will require thorough reviews from both antitrust regulators and national security groups in multiple countries around the world,” reads an excerpt from Qualcomm’s latest letter.

“Regulators in many countries may call for conflicting remedies based on their specific concerns.”

Understanding the takeover bid

Broadcom formally put forward a $103%20billion%20USD%20bid%20to%20purchase%20Qualcomm,%20on%20November%206th,%202017.Qualcomm%20rejected%20Broadcom’s%20initial%20offer,%20arguing%20that%20Broadcom%20greatly%20undervalued%20the%20company.Broadcom%20responded%20to%20Qualcomm’s%20rejections%20by%20putting%20forward%20a%20list%20of%20nominees%20for%20Qualcomm’s%20board%20of%20directors.%20In%20response,%20Qualcomm%20publicly%20stated%20that%20its%20board%20had%20unanimously rejected Broadcom’s nominees.

Qualcomm later issued a formal letter to its stockholders, beseeching voting members to reject Broadcom’s nominees at the company’s March 6th, 2018 meeting — no doubt concerned that pandemonium could break loose at the meeting itself.

Assuming that Qualcomm’s director voting process works similarly to other boards, voting members can most likely write in candidates or put forward motions during the meeting to consider other options.

As such, even though Qualcomm’s board has rejected Broadcom’s nominees, the company’s voting stockholders no doubt have the ability to exert control over the company as well.

Source: Qualcomm