Qualcomm plans to defer the $130 billion offer received from Broadcom

The chip maker Qualcomm plans to defer the $130 billion offer it received from its competitor Broadcom, paving the way for one of the biggest takeover battles in the history of the global high-tech sector.

Qualcomm today confirmed that it had received a “hostile purchase offer” and said that the company’s board of directors would review the offer. However, the company refuses to open talks with Broadcom, several people involved in the situation told The Financial Times.

Broadcom offers to buy Qualcomm for a record $130 billion

A person close to Qualcomm told The Times that the $70 offer price was significantly lower than the board would seriously consider. Another source described the offer as “opportunistic,” in light of the fact that Qualcomm’s share price fell due to a licensing dispute with Apple.

Broadcom, a communications chip maker, has submitted a bid to acquire Qualcomm in a deal worth $130 billion, including a $ 5 billion cash fund for Qualcomm. Broadcom will pay $70 per share for Qualcomm, shares and cash. The price is 28% higher than Qualcomm’s closing price on November 2. If they merge, the two will create a $ 200 billion company with annual revenues of $ 40 billion.

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.