In recent days, the semiconductor business has been talking about nothing but the fact that the chip maker Broadcom wants to buy rival Qualcomm for 130 billion dollars. At first, it was only speculation, but it was confirmed yesterday, when Broadcom officially submitted a buyout offer. If Qualcomm agrees to the offer, it will be the largest acquisition in the technology sector to date.
Broadcom CEO Hock Tan said the offer was very attractive to shareholders of both parties. "We would not have made the offer if we were not confident that our global customers would accept it."
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Broadcom is offering $60 in cash and $10 in its own stock for each Qualcomm share, with the $70 amount including a 28% premium to Qualcomm's closing stock price on Nov. 2. The proposed $130 billion includes $25 billion in debt.
If Tan convinces Qualcomm's board to accept the offer, it will make Broadcom the world's third-largest chip maker, behind Intel and Samsung. Broadcom's stock is up 60% over the past year, while Qualcomm's stock is falling amid a legal battle with Applem. However, shortly after speculation began that Broadcom wanted to acquire Qualcomm, the share price of both companies rose.
Both companies offer Wi-Fi adapters, but Qualcomm focuses more on phone modems and SoCs, while Broadcom focuses on industrial and less visible components.onenty.
Source: The Verge
Qualcomm is reaching for it IMHO. Apple for two years now there is a threat that they will make their own semiconductors, and the demand will probably not increase when the input price of raw materials increases.