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The move sees Broadcom offer US$82 per share for Qualcomm, being US$60 in cash and the rest in Broadcom shares.
“The significantly improved offer, which has been unanimously approved by the Board of Directors of Broadcom, represents a 50% premium over the closing price of Qualcomm common stock on 2 November 2017, the last unaffected trading day prior to media speculation regarding a potential transaction, and a premium of 56% to Qualcomm’s unaffected 30-day volume-weighted average price,” the interested buyer wrote in a press release.
The offer is predicated on Qualcomm either buying NXP on the current terms or dropping the deal. The offer is also predicated on Qualcomm not delaying its annual meeting past 6 March 2018. But Broadcom is also sweetening the talks by offering a breakup fee in the event that the transaction isn’t closed within a year of a deal being reached.
Broadcom has upped its offer for Qualcomm — but will the US company give the green light?
“This proposal to acquire Qualcomm is extremely compelling compared to any other alternative available to Qualcomm, with or without the acquisition of NXP, and we believe any responsible board would engage with us, without further delay, to turn this proposal into an executed definitive agreement,” read an excerpt of a letter sent to Qualcomm.
“We continue to hope you choose to engage with us for the benefit of your stockholders. However, we will withdraw this proposal and cease our pursuit of Qualcomm immediately following your upcoming annual meeting unless we have entered into a definitive agreement or the Broadcom-nominated slate is elected.”
The move comes after Qualcomm rebuffed a previous offer from Broadcom. But it also comes after the US mobile chipmaker suffered a bruising EU ruling. The European Commission fined Qualcomm US$1.2-billion for a controversial exclusivity deal with Apple.