Broadcom Goes After Qualcomm's Board As Part Of Takeover Bid

Broadcom on Monday nominated 11 people who it suggested should replace Qualcomm's existing board of directors, having publicly signaled the start of a hostile takeover attempt. The San Diego, California-based company harshly criticized the proposal as an attempt of pressuring its investors into agreeing to a bid that it believes severely undervalues the firm and comes with significant uncertainty. "Regulatory issues" attached to the proposed deal could potentially prevent it from ever being completed, Qualcomm said, adding that even if the merger was to survive antitrust scrutiny in all parts of the world, it still wouldn't be finalized for at least one more year which makes Broadcom's director nominations even more misleading and premature.

The unsolicited bid launched by Broadcom last month amounts to $130 billion including $25 billion in debt and would be by far the largest tech acquisition in the history of the technology industry, albeit Qualcomm's board unanimously rejected it as being too low. While Broadcom is presently said to be considering raising the bid to convince more investors to sell, its historic M&A practices suggest that even if the deal goes through, it wouldn't end up being significantly more valuable than the initial offer. The first bid was still more than enough to convince some shareholders to start putting pressure on Qualcomm's board to haggle with Broadcom while simultaneously flirting with the propositioning entity.

Qualcomm's Monday remarks are seeking to remind investors that Broadcom's bid doesn't encompass committed financing, with the company also failing to commit itself to resolving major regulatory issues attached to the deal. The tech giant added that all of its current directors are entirely committed to acting in the best interest of investors, whereas Broadcom's nominations are just "a blatant attempt" of taking over Qualcomm's board in order for the hostile takeover to be completed. It's currently unclear how likely is Broadcom to gain the majority of Qualcomm's board seats, though investors will have a chance to (not) vote for its nominees at Qualcomm's next Annual Meeting of Stockholders scheduled for March 6th. The nominees themselves were recruited by Broadcom and its investor Silver Lake, whereas the conglomerate's bid still amounts to $70 per share, with $60 being meant to be paid in cash.

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Dominik Bosnjak

Head Editor
Dominik started at AndroidHeadlines in 2016 and is the Head Editor of the site today. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]
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