Broadcom, a maker of communications chips from the United States, announced Monday that it has submitted a takeover bid to Qualcomm. Broadcom proposed to cash and stock 70 US dollars per share acquisition of all outstanding shares of Qualcomm. Including Qualcomm debt, the transaction total more than 130 billion US dollars. This transaction will be the largest M & A deal in the history of technology.
Qualcomm and Broadcom are the world's two largest manufacturers of handsets for wireless communications. If the merger of the two companies, will pose a serious threat to Intel in recent years to get involved in the smart phone chip industry.
Broadcom proposed the purchase price, higher Qualcomm closing price of 54.84 dollars on Thursday a premium of 27.64. After the media revealed Broadcom may get Qualcomm news, Qualcomm shares rose 12.71% last Friday, to close at 61.81 US dollars. According to last Friday's closing price calculation, Qualcomm market value of about 91.1 billion US dollars. Driven by Broadcom's formal offer, Qualcomm shares rose more than 3% in Monday's pre-market trade.
Broadcom said the company will buy 60 shares of Qualcomm Inc.'s outstanding shares in cash at a price of $ 60 a share. In addition, the deal will include Broadcom's willingness to continue Qualcomm's $ 38 billion acquisition of NXP Semiconductors. The merger together, Broadcom acquisition Qualcomm to pay more than 130 billion US dollars.
It is reported that Broadcom plans to acquire Qualcomm has lasted several months, is expected to have been on the acquisition issues and Qualcomm had contacts, but soon led to the refusal of Qualcomm. Sources said Qualcomm announced the acquisition of NXP more than a year ago, Broadcom had already considered acquiring Qualcomm. However, this proposal still led to the refusal of Qualcomm.
Broadcom announced the acquisition of Qualcomm news, the purpose is to obtain the support of Qualcomm shareholders. Sources said Broadcom may be able to get through the proxy battle some Qualcomm board seats, so that the Qualcomm board of directors to support the company's acquisition proposal. Qualcomm's annual general meeting of shareholders will be held in March next year, the company's nomination of the next director's work is expected to be carried out sometime in December this year.
However, Qualcomm is expected to strongly oppose Broadcom's acquisition proposal. The source said Qualcomm will emphasize Broadcom's acquisition price is far lower than the company can receive the purchase price. In addition, Qualcomm will also propose that the acquisition deal with Broadcom may lead to a detailed investigation of antitrust regulators.
While Broadcom expressed its support for Qualcomm's continued completion of the acquisition of NXP, the company is not expected to support Qualcomm's proposed price increase of NXP. At present, some NXP shareholders are putting pressure on Qualcomm to require the latter to raise the purchase price, otherwise it will face the problem of failing to meet the minimum shareholding standards and thus fail to complete the acquisition. Up to now, both Qualcomm and Broadcom officials did not comment on this report.
Qualcomm's earnings for the fiscal fourth quarter of fiscal 2017, as of September 24, 2017, released Wednesday, showed fourth-quarter revenue of $ 5.9 billion, down 5% from $ 6.2 billion a year earlier; Net profit was 200 million U.S. dollars, down 89% from 900 million U.S. dollars in the same period of last year.
Qualcomm chief executive Steve Mollenkopf said in a earnings report, "Our FY17 full year and fourth-quarter results show that the company's semiconductor business profitability and product market leadership Continuous improvement. We see shipments of 3G / 4G devices worldwide are still growing, and we are currently focusing on protecting the company's patented technology and the established value of the invention. We are currently leading in 5G technology, our products and
Technology continues to expand into many exciting new product categories, such as automotive, mobile computing, networking and the Internet of Things. & rdquo;