Broadcom $120 Billion Qualcomm Bid Rejected
Qualcomm, semiconductor and processing chip maker, was offered an offer to be acquired by another chipmaker, Broadcom for a considerable sum of $ 120 billion (RM480 billion) last Monday. Many thought that the company’s board would find the offer hard to refuse. However, the Qualcomm board was unanimous in rejecting the $120 billion offer.
The Qualcomm’s board of directors, along with legal and financial advisors, said the offer was rejected because they felt that the offer would not only weaken Qualcomm’s position as one of the largest silicon manufacturers in the world, but also various weaknesses in the offer that did not conform regulatory commitment set by Qualcomm’s board of directors.
Qualcomm’s board sent Broadcom a letter outlining the reasons why it noped out of the deal, writing, “Broadcom proposal materially undervalues Qualcomm and falls well short of the firm regulatory commitment the Board would demand given the significant downside risk of a failed transaction. ” The decline on the $120 billion does have a silver lining for Broadcom, the Qualcomm board has offered to meet “to see if it can address the serious deficiencies in value and certainty in its proposal.”
This isn’t the first rejection Broadcom has faced on its path to buying Qualcomm. Late last year, Qualcomm’s board again unanimously rejected Broadcom’s first offer, which was valued at just over $100 billion.
Although Qualcomm declined Broadcom’s offer for now, Qualcomm also expressed a wish to meet and talk to Broadcom about the new improved offer.