Qualcomm Rejects Broadcom's Higher $121 Billion Hostile Bid

• February 08 2018
• Ian King

Qualcomm Inc.’s board rejected a higher acquisition offer from Broadcom Ltd., spurning the largest technology takeover bid in history and likely leaving the future of the hostile $121 billion deal to be decided by shareholders next month.

Qualcomm Inc.’s board rejected a higher acquisition offer from Broadcom Ltd., spurning the largest technology takeover bid in history and likely leaving the future of the hostile $121 billion deal to be decided by shareholders next month.

The offer “materially undervalues” Qualcomm and falls “well short of the firm regulatory commitment” needed to gain approval of such a deal, the San Diego-based company said Thursday in a statement. Earlier this week, Broadcom raised its proposed price to $82 a share, a bid it called “best and final.” The deal would take the form of $60 in cash and the remainder in Broadcom shares, a bump of 17 percent from its opening offer in November of $70 a share, which Qualcomm also rejected.

Qualcomm said it has offered to meet with Broadcom to “see if it can address the serious deficiencies in value and certainty in its proposal.”

Despite the offer of discussions, Qualcomm’s second dismissal of Broadcom’s approach may put the decision in the hands of shareholders, who will vote March 6 on whether to replace the smartphone-chip maker’s board with Broadcom’s own nominees. The vote will represent a choice between Broadcom’s strategy, under Chief Executive Officer Hock Tan, of acquiring companies and focusing on boosting profits, or Qualcomm management’s promise of future growth fueled by investment in new products and technology.