Qualcomm increases NXP acquisition offer to $44 billion USD

NXP has until March 5th, 2018 to accept the offer

U.S.-based chip manufacturer Qualcomm has announced it has increased its offer price to acquire Dutch-based chip manufacturer NXP Semiconductors.

In a February 20th, 2018 media release, Qualcomm said that both its board and NXP’s board had approved an offer price of $127.50 USD, while also agreeing to lower the minimum tender condition to 70 percent of NXP’s shares from 80 percent.

Additionally, Qualcomm has entered into binding agreements with nine NXP stockholders who collectively own approximately 28 percent of NXP’s shares. These nine stockholders have all agreed to sell their shares at $127.50 USD per share.

Qualcomm will spend an estimated $44 billion USD to acquire NXP. The previous offer was roughly $38 billion USD.

NXP has until March 5th, 2018 to accept Qualcomm’s offer.

“The acquisition of NXP will enable us to accelerate our growth strategy,” said Tom Horton, presiding director of the Qualcomm board of directors, in the same February media release.

According to the media release, Qualcomm’s board agreed to the price increase because of NXP’s strong 2017 performance; NXP’s automotive and IoT divisions; as well as “high confidence” generated from the integration planning process.

“NXP is a highly strategic and attractive acquisition for Qualcomm that enhances the value of our leading 5G technologies,” said Dr. Paul E. Jacobs, chairman of Qualcomm’s board, in the same February release. “We also believe the revised agreement provides certainty for both Qualcomm and NXP stockholders.”

According to Qualcomm, eight of the nine governmental regulatory bodies required to approve the deal have already given their blessing.

The company gained approval from antitrust regulators in Europe and Korea in January 2018. The only remaining agency needed to sign off on the deal is China’s Ministry of Commerce (MOFCOM).

“Qualcomm is optimistic it will receive MOFCOM clearance in the near term,” reads an excerpt from the February release.

Source: Qualcomm