Broadcom is preparing for making an unsolicited offer of $100 billion or about $70 a share to buy Qualcomm. The plans are private and the acquisition could come as soon as Monday.
If the master dealmaker behind Broadcom, Hock Tan will get success in convincing Qualcomm’s board, it will beat the competitors in the multibillion-dollar deals for the semiconductor industry. If accomplished, it will be known as the biggest acquisition in the technology sector.
Qualcomm will argue the proposal, giving the offer due consideration, and the San Diego-based company will probably recommend that shareholders reject it. In result, if Broadcom wishes to proceed, the argument would force Broadcom to pursue a proxy fight. A Qualcomm spokesman is not commenting on it, and Broadcom has not revealed any response.
Chipmakers are forcefully competing for making the position among the shift from an industry controlled by PCs and smartphones into a world of self-driving cars and “internet of things.” The move will offer 5G wireless networking.
Broadcom has its own position in selling chip design ranges for networking equipment from different ranges. Though it sells back-end telecoms infrastructure to the Wi-Fi and Bluetooth controllers in the latest iPhones, it is weak in selling current 4G/LTE networking technology.
According to the report, Qualcomm’s leadership would prefer to remain independent and follow its own expansion strategy to beat its competitors. The company has its own mega deal, for purchasing Netherlands-based NXP for 47 billion. But the deal may be delayed up to the next year because of government scrutiny.