Certified company | Engineering the world

Get in touch

Broadcom Is Still Pursuing Qualcomm

Feb 5, 2018 | Uncategorized | 0 comments

The big acquisitions between companies are never fast, even less when one of the parties is not completely in agreement with the deal, or has its own plans to raise the final bid. Such is the case of Broadcom and Qualcomm, a pair of chip manufacturers that have been on the front page of technological and economic newspapers for several reasons. The main one is that Broadcom wants to take control of Qualcomm.

Also Read: Qualcomm VC, Cristiano Amon, Is Not Bothered By Apple And Broadcom

The initial offer was followed by different reactions, the most powerful of which came from China, which questioned about possible monopolistic results in the sector. Qualcomm, meanwhile, was recently strengthened with the purchase of NxPand and signed an agreement with Samsung , to share patents, and with several Chinese manufacturers to ensure supply for another three years. But Broadcom hasn’t given up and the bet will rise soon, according to Reuters sources.

Also Read: Broadcom Has Not Given Up On Qualcomm!

Broadcom struggles for a long time to take control of Qualcomm, the pearl that the company wants to put on its return to the United States, propitiated by the promise of a sensible reduction of taxes signed by  Donald Trump. The initial offer of Broadcom amounted to a global amount of 103.2 billion dollars, an offer that would mean the complete absorption of Qualcomm in the structures of the giant based in Singapore.

Also Read: Qualcomm Rejects Broadcom’s Offer

According to Reuters sources, Broadcom is on the verge of increasing the offer. If in the previous bid a price of 70 dollars was established for each share of Qualcomm, 60 dollars to be paid in cash plus another 10 dollars in shares of Broadcom, the new one would be placed approximately at around 80 or 82 dollars per share.

Also Read: Broadcom Formally Proposes To Buy Qualcomm For 130 Billion US Dollars

Broadcom’s new offer: 120,000 million dollars to buy Qualcomm and 4,800 million dollars if regulators prevent the purchase. Broadcom would also undertake to offer a higher severance bonus, the amount to be paid in case the operation was frustrated by the reports of the different regulators.This new break-up premium would reach 4% of the total purchase agreement. That is, 4,800 million dollars for Qualcomm if the purchase could not be completed.

Broadcom seems quite convinced of being able to complete the acquisition within a period of 12 months from the signing of the agreement between both parties, although Qualcomm would be aware that the supervision of the regulators would require a longer term, reaching up to 18 months, until obtaining all approvals. It remains, therefore, to be seen, because once the new offer is on the table it will be the turn of Qualcomm to decide, together with its shareholders, what will be its next step. If there is finally a purchase or there is not.


let’s get connected

Have a Question?

If you have any questions or need to discuss about your project
Feel free to reach out to our friendly team.