Broadcom is back at it a second to take over rival Qualcomm. This time, the company is now proposing to replace Qualcomm’s current board of directors after its original $130 billion big was fully rejected, according to The New York Times.
Broadcom’s strategy seems pretty clear here. Since Qualcomm’s board of directors rejected the takeover proposal, the company is now attempting to take the issue directly to Qualcomm’s shareholders. Qualcomm has already released a statement blasting Broadcom’s take over attempt, calling this attempt to replace board of directors “a blatant attempt to seize control of the Qualcomm Board in order to advance Broadcom’s acquisition agenda.”
While Qualcomm has blasted Broadcom for this attempt, they also state that the company has yet to offer any appropriate solutions to regulatory hurdles that may come up. Broadcom also hasn’t committed to financing nor has it completed its transition from Singapore to the United States.
Qualcomm’s leadership believes that Broadcom’s offer “dramatically undervalues” them. This does, however, leave the door open for Broadcom to come in with a better offer that Qualcomm may consider, but that’s quite a ways away. In addition, Qualcomm is continuing its development of its mobile chips and transition into 5G networks. It’s current board remain optimistic about the company future and offering better returns to shareholders in the future.
Qualcomm’s annual shareholders meeting isn’t until March 6th, as noted by The New York Times. This is also when the next election of board members will occur, and gives Broadcom plenty of time to make its arguments for a potential takeover.