Broadcom on Wednesday said its proposal to merge with Qualcomm would turn the United States into a global 5G leader, vowing to finance additional wireless research and development efforts should the two entities manage to consolidate. The Singapore-based company also criticized Qualcomm's licensing practices, having deemed them "anticompetitive" and asserted it will still support the San Diego-based chipmaker's 5G innovation efforts independently of the company's other ambitions if they end up merging. The tech giant vowed to create a $1.5 billion fund meant to finance educational initiatives focused on American engineers so as to support the country's efforts in the wireless segment.
The fund itself is meant to be focused on 5G R&D through what Broadcom deems "lawful practices," with the company calling Qualcomm's existing activity in the segment "predatory." The semiconductor giant used the pledge as an opportunity to assert it's an American company "in every important respect," pointing to its Hewlett-Packard roots and the fact that it's presently in the process of redomiciling its operations to the U.S., with that feat being expected to be completed by May 6. The U.S. Treasury's national security panel that postponed the Broadcom-Qualcomm showdown originally scheduled to take place yesterday as part of Qualcomm's annual shareholder meeting is set to lose its jurisdiction over the matter once Broadcom successfully relocates its headquarters to San Jose, California. Broadcom is also quick to point out that its top management is primarily made up of Americans and that its institutional owners largely consist of the same entities which are invested in Qualcomm. Due to that state of affairs, the company believes its tie-up with the chipmaker could be completed within a year of being agreed without major setbacks.
Qualcomm still insists the $117 billion bid is materially undervaluing its assets due to interim setbacks faced by its licensing business in recent years. Previous reports suggested the firm would be prepared to accept a $160 billion bid but that offer remains unlikely. Qualcomm is expected to aggressively pursue its attempt to acquire Dutch NXP Semiconductors and resolve some of its patent royalty disputes over the next month so as to try to convince more investors to vote against Broadcom's directorial candidates the company is trying to install to the chipmaker's board with the goal of winning a majority vote necessary to accept its current bid.