Qualcomm Board rejected Broadcom 121 billion acquisition bid

In a letter to Hock Tan, Qualcomm chairman Paul Jacobs said the offer of $ 121 billion offered "a serious undervaluation" of Qualcomm. However, Qualcomm's board was still reluctant to say that they have made plans to interview Broadcom ...

EETimes SAN FRANCISCO (Dow Jones) - Qualcomm's board of directors rejected a bid from Broadcom Corp. after it raised its offer, saying it underestimated Qualcomm and would not ask Broadcom to break up even if the transaction was vetoed by regulators.

However, the board of directors of Qualcomm was still reluctant to say that it had offered to meet with Hock Tan, chief executive of Broadcom, to discuss the proposal.

Qualcomm chairman Paul Jacobs said in a letter to Hock Tan that "if Qualcomm agreed to be acquired by Broadcom, Qualcomm's business model will allow corporate clients and patents to be Grantor's income is at risk, and Qualcomm will suffer substantial and irreparable damage if the transaction is not approved after regulatory review, "writes Jacobs.

"If something needs to be done to ensure the deal is done and you do not want to do it, we need you to be very specific and specific about what actions you will reject so that we can properly assess the risks to Qualcomm shareholders. He added.

Paul Jacobs
Jacobs also believes in the letter that the offer of $ 121 billion offers a "grossly underestimated" Qualcomm and does not add value to Qualcomm's acquisition of NXP Semiconductor's pending case or to the opportunities offered by current 5G cellular technology .

In November last year, Qualcomm's board unanimously rejected Broadcom's initial offer, which was about $ 105 billion. Broadcom then launched a hostile takeover bid for Qualcomm and nominated a series of new directors to Qualcomm's board of directors. Qualcomm shareholders will vote for the directors at the company's annual general meeting next month.

Broadcom earlier this week raised its bid for QUALCOMM to submit "best and final" bids up to $ 121 billion to Qualcomm. Broadcom, in an article published on its Web site, criticized the performance of Qualcomm executives by saying Qualcomm's "business model has been broken for a long time," and the performance of the company's stock lags far behind its peers. Broadcom also said Qualcomm failed to make money through 4G technology and said that even if the transition to 5G will not be any different.