Broadcom makes offer to acquire Qualcomm in record $105bn deal

As of Monday, shares of Qualcomm are still about 8% lower than the $70 per share offer price.

Semiconductor vendor Broadcom is on the verge of making a $130bn (£99bn) bid for chip maker Qualcomm in what would be the largest technology takeover ever, according to reports.

Qualcomm declined to comment, while Broadcom did not immediately respond to a request for comment.

Broadcom said on Monday that it is offering Qualcomm $60 in cash per share and $10 per share in Broadcom stock, valuing the deal at about $130 billion.

Tan visited President Trump at the White House last week to announce that Broadcom would be moving its headquarters from Singapore to Delaware.

"The combined company will be positioned to deliver more advanced semiconductor solutions for our global customers and drive enhanced stockholder value", he added.

Qualcomm has a (long) pending acquisition, of chipmaker NXP Semiconductors NV, in the works - and Broadcom notes that its offer is not dependent on whether or not Qualcomm manages to close with NXP on the now disclosed terms (it's offering ~$39BN for the Netherlands-based chipmaker which has a focus on car-related applications and also security-based identification).

Broadcom also said that it's offer stands regardless of whether the NXP deal goes through or is terminated.

And a premium of 33 per cent on Qualcomm's "unaffected 30-day volume-weighted average price".

The proposed deal comes at a time when there has been significant consolidation within the chipset market, driven by greater demand for smartphones and connected devices.

Adjacent products are often cheaper when offered by one company, according to standard economic theory, which could be good for phone makers and potentially incline regulators toward allowing the deal, said Henry C. Su, a former Federal Trade Commission trial attorney. Broadcom already provides designs for Wi-Fi and Bluetooth chips, and by bringing in Qualcomm it will be able to encompass LTE and 5G capabilities.


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