Qualcomm to Broadcom: "We're not interested".

Qualcomm tells Broadcom Offer 'dramatically undervalues' the company

Qualcomm tells Broadcom Offer 'dramatically undervalues' the company

Broadcom made an unsolicited bid last week to pay $70 per share in a deal that would value the San Diego-based chipmaker at $130 billion, including $25 billion in net debt.

Qualcomm also warned that such a merger would face significant regulatory hurdles.

Qualcomm has announced that its board of directors has unanimously rejected the unsolicited proposal announced by Broadcom Limited ("Broadcom") on November 6, 2017, saying the bid "significantly uvervalues" the chip firm's value.

But whether Broadcom is willing to make an offer Qualcomm can't refuse still isn't clear.

Qualcomm has moved quickly to rejected rival Broadcom's $130bn takeover bid, claiming that it "dramatically undervalues" the company, but hinted that a significantly raised offer might be accepted.

Tan said he's pleased with the reaction he's already received from Qualcomm shareholders and customers regarding his proposal and would prefer to keep the negotiations friendly. "We are confident in our ability to create significant additional value for our stockholders as we continue our growth in these attractive segments and lead the transition to 5G", said Mollenkopf. If it does sell to Broadcom, it means the combined businesses' chips will be present in more than a billion smartphones sold every year. In fact, if the deal goes ahead it would probably the biggest in the technology industry's history, worth more than Dell's purchase of EMC in 2015, which was valued at $67 billion.

"We have received positive feedback from key customers about this combination", he said in a statement after Qualcomm's rejection.

"Qualcomm shareholders are likely to hold out for more, but we believe something in the US$80-ish range is likely enough to bring majority around", Sanford C. Bernstein analyst Stacy Rasgon wrote in a note published at the weekend. But analysts say Broadcom still has some cards to play: It could simply sweeten its bid, of course, or as Bloomberg pointed out, it could wage a proxy battle by bringing its offer directly to Qualcomm shareholders. It is engaged in a patent infringement dispute with Apple Inc, and is also trying to close its $38 billion acquisition of automotive chipmaker NXP Semiconductors NV after signing a deal in October 2016. "We are highly confident that the strategy Steve and his team are executing on provides far superior value to Qualcomm shareholders than the proposed offer". "Broadcom has to convince those companies that they stand to benefit".

Broadcom is not Qualcomm's only headache.

Information for this article was contributed by Tiffany Hsu of The New York Times.