Qualcomm Incorporated-owned Qualcomm River Holdings extended the deadline for its acquisition of NXP Semiconductors to January 12th, 2018, the tech giant said earlier this month. The San Diego, California-based chip manufacturer originally announced the deal in late October 2016 and was seeking to close it by the end of this year but ended up being unable to do so following regulatory roadblocks. The short delay suggests final approvals are close to being issued, which Qualcomm confirmed in its Friday statement.
The tender offer itself is valued at approximately $38 billion, or $110 per share, a premium of 11.5 percentage points compared to NXP's valuation in late 2016. Not all investors are pleased with the proposed price, with Elliott Management recently claiming the offer undervalues the firm by a significant margin, having previously cited a UBS Valuation Report as proof that NXP's assets are worth approximately $135 per share. Qualcomm deemed those claims "unsupportable" earlier this month, accusing the hedge fund as publicizing misleading allegations with the sole goal of promoting its "self-serving agenda." Elliot Management owns approximately six percent of NXP and is unlikely to be able to stop the deal from being concluded through any means once Qualcomm receives all of the necessary regulatory approvals. While the European Union is yet to greenlight the purchase of the Dutch semiconductor giant, industry watchers believe it's likely to do so in the coming weeks after Qualcomm reportedly revised its offer and only proposed a partial acquisition, suggesting an incomplete purchase of NXP's patent portfolio that wouldn't include its standard-essential patents.
As part of the same offer, Qualcomm is said to have vowed against proactively taking any legal action based on Near Field Communication (NFC) patents held by NXP. With the rising popularity of mobile payments and devices in the Internet of Things segment, NFC technologies are expected to play an even more important role in the electronics industry going forward. Qualcomm is presently in the process of trying to fight against a hostile takeover attempt on the part of Broadcom, another semiconductor giant seeking to acquire the firm for $130 billion including $25 billion in debt. Should its efforts to do so be successful and receive regulatory approval, Broadcom would author by far the largest takeover in the history of the tech industry which would dwarf Dell's 2016 acquisition of EMC valued at $67 billion. Broadcom previously said its offer for Qualcomm stands irrespectively of the company's bid to merge with NXP.