US Treasury Orders Qualcomm Shareholder Meeting Delay

The Committee on Foreign Investment in the United States presided by the Secretary of the Treasury ordered Qualcomm to delay its annual shareholder meeting planned to take place tomorrow, Reuters reported Monday, citing a statement from a government representative. The security panel is seeking a 30-day delay in order to have enough time to investigate Broadcom's proposed takeover of Qualcomm that could be agreed following the stakeholder meeting where the Singapore-based semiconductor manufacturer is seeking to overthrow Qualcomm's board and install enough of its own candidates to win a majority vote in favor of the consolidation. The approached party has repeatedly warned its investors against supporting Broadcom's coup attempt yet the unsolicited suitor reportedly amassed enough support to worry Qualcomm's current management.

Qualcomm itself repeatedly said it doesn't intend to delay the annual shareholder meeting, whereas the security panel that ordered it will lose its jurisdiction over the matter once Broadcom completes its relocation efforts and moves its headquarters back to the U.S. The company that last offered $117 billion for Qualcomm and suggested by far the largest merger in the history of the technology industry claims the tie-up doesn't only make sense due to the duo's assets being highly complementary but should also be relatively straightforward to conclude despite its scope as both parties are largely backed by the same institutional investors. Qualcomm remains adamant the new offer and the old $121 billion bid severely undervalue its assets, largely due to interim setbacks its licensing business faced on the antitrust front in recent times. Previous reports suggested Qualcomm would accept a bid in the ballpark of $160 billion but such an offer is highly unlikely in light of Broadcom CEO Hock Tan's M&A history.

Broadcom claims Qualcomm never disclosed the security panel's approach during their two merger-related meetings, pointing to the development as evidence that the San Diego-based firm isn't fully transparent with its investors. Qualcomm could resist the hostile takeover attempt if it manages to conclude its own $44 billion NXP purchase over the next month. The chipmaker repeatedly claimed it would be open to an improved bid, though Broadcom called its $117 billion offer "final."

You May Like These
More Like This:
Android Headlines We Are Hiring Apply Now