Published On: Mon, Nov 6th, 2017

Broadcom Offers to Buy Qualcomm for a Record $130 Billion

The price - $ 70 per share in shares and cash - is 28% higher than the closing price on November 2 ■ Qualcomm shares rise on Wall Street before the opening ■ Broadcom made 13 acquisitions of Israeli technologies, and Qualcomm has 500 employees in Israel

 

Steve Mollenkopf, CEO of Qualcomm, responds to a question during the 2014 Consumer Electronics Show (CES) in Las Vegas

 

Wireless chip manufacturer Broadcom filed a bid for the acquisition of competitor Qualcomm in a deal worth $130 billion. It will pay $ 70 per share for Qualcomm, including $ 60 in shares and $ 10 in cash. The price is 28% higher than Qualcomm’s closing price on November 2.

Qualcomm shares are up 3.4% in trading before the opening, with Broadcom adding 0.5%. With the publication of preliminary reports on the planned merger, the two shares jumped on Wall Street trading on Friday. Qualcomm is in the process of acquiring rival NXP, and could lose Apple, one of its biggest customers.

Broadcom entered Israel in 2000, and its local operations are managed by Shlomo Merkel. It has about 700 employees in several activity centers: Airport City, Tel Aviv, Herzliya, Ra’anana, Yakum and Nazareth. Broadcom made 13 acquisitions of Israeli technologies, including the acquisition of BroadLight for $ 195 million (2012), the acquisition of Provigent for $ 313 million (2011); Dion Networks for $ 178 million (2009) and VisionTech for $250 million (2000).

Qualcomm entered Israel in 1993 and its local business is managed by Arik Mimran. It employs some 500 people, who are located in centers of activity in Hod Hasharon and Haifa. Qualcomm’s largest acquisition in Israel was in 2014, when it paid $ 400 million for start-up Willocity from Caesarea. A year earlier, it acquired the CSR camera group, most of whose activities were in Israel. Other Qualcomm acquisitions include Epos, Design Art Networks and iSkoot, whose activity in Beit Shemesh closed two years ago.

Qualcomm also invested in dozens of Israeli startups, through its investment arm Qualcomm Ventures, which is managed in Israel by Merav Weinrib. Its investments are spread across a variety of fields, including the video editing application Magisto, the game company Tabetail, the payment company Tefingo, the database company Skyla DB, and the Wielut semiconductor company. The company was among the investors in Weis, which was sold to Google in a $ 1 billion deal, and Bravelo, which was sold last year to Oracle for $ 430 million.

Broadcom CEO Hock Tan has been known as a serial purchaser and has played a key role in the mergers and acquisitions wave that has engulfed the semiconductor sector over the past three years, with Broadcom, which was created in 2016, when Avago Technologies acquired Broadcom Corp. for $ 37 billion, Has turned itself from HP’s Hewlett-Packard division into one of the largest chip makers through a series of acquisitions, Tan said he plans to make further acquisitions, a strategy that could face opposition from US regulators. [The Marker in Hebrew]

 

 

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