Advertise on ITWeb         Sun, 17 Dec, 00:33:59 AM

Broadcom moves towards a hostile take-over of Qualcomm

Chipmaker Broadcom announced an unsolicited bid to buy peer Qualcomm for $103 billion.

Chipmaker Broadcom announced an unsolicited bid to buy peer Qualcomm for $103 billion.

Chipmaker Broadcom made its first formal move towards a hostile bid to take over Qualcomm on Monday, laying out a slate of 11 nominees it wants to put on the board of the US semiconductor firm.

Shares of both companies fell as Qualcomm confirmed receiving the list, saying Broadcom's action was a "blatant attempt to seize control of the Qualcomm board in order to advance Broadcom's acquisition agenda".

Qualcomm last month rejected Broadcom's $103 billion cash-and-stock bid, saying it dramatically undervalued the company, a line it repeated in Monday's statement.

Shareholders will be able to vote for or against the Broadcom nominees at an annual meeting on 6 March 2018.

The list of nine men and two women included a former president of the mobile networks business group of Nokia and the former director and chairman of the board of Dialog Semiconductor.

"We have heard from many Qualcomm stockholders who have expressed their desire for Qualcomm to engage with us," Broadcom chief executive Hock Tan said in a statement on Monday.

"We have repeatedly attempted to engage with Qualcomm, and despite stockholder and customer support for the transaction, Qualcomm has ignored those opportunities. The nominations give... stockholders an opportunity to voice their disappointment."

The slate will be heavily scrutinised, because the nominees will not just be asked to put Qualcomm up for sale, but will have to oversee the company until a deal with Broadcom closes.

"These nominees are inherently conflicted given Broadcom's desire to acquire Qualcomm in a manner that dramatically undervalues Qualcomm to Broadcom's benefit," Qualcomm said.

Reuters reported on Sunday that Broadcom would unveil the nominees on Monday and that private equity firm, Silver Lake, an investor in Broadcom, helped with the effort to recruit the nominees.

Qualcomm said in its statement on Monday that Broadcom and Silver Lake were effectively asking stockholders to foreclose options and make a decision now on a non-binding proposed transaction that may not be completed for well over a year.

Broadcom did not give details of any new offer for Qualcomm. Reuters reported last month that Broadcom was considering raising its offer by offering more of its own stock.

Qualcomm shares fell 1.8%, while Broadcom lost 2.2%.

Copyright 2017 Reuters Limited. All rights reserved. Republication and redistribution of Reuters content is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.


Our comments policy does not allow anonymous postings. Read the policy here




 

 

 

Sponsors Message