Broadcom sweetens Qualcomm takeover bid

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SAN DIEGO — In its continued attempt to take over San Diego- based Qualcomm, rival chip maker Broadcom Monday upped its offer from $70 a share to $82 a share, pushing the total deal to about $121 billion in what would be the largest deal ever in the electronics industry.

The renewed bid comes a month before Qualcomm’s annual shareholder meeting, when Broadcom hopes to replace Qualcom’s current board of directors. Late last year, when Qualcomm’s board rejected the $70-per-share buyout, Broadcom responded with a list of nine men and two women it wants to seat on Qualcomm’s board.

Qualcomm denounced that plan, but shareholders will be asked to vote on the competing slates of candidates, with results to be announced at the shareholders meeting scheduled for March 6.

Like the original offer, the new offer from Broadcom would pay Qualcomm shareholders $60 per share in cash. But the new offer would pay Qualcomm shareholders $22 per share in Broadcom stock, up from the $10 per share offered in the original offer.

In a statement, Broadcom called the new offer its “best and final” offer, while company CEO Hock Tan told the New York Times that “any rational board would consider what we’ve put forward.”

Qualcomm executives said the company’s board of directors would review the revised proposal “to determine the course of action it believes is in the best interests of the company and its stockholders.”

Qualcomm’s board of directors had said the $70-per-share proposal “dramatically undervalues Qualcomm and comes with significant regulatory uncertainty.”

Broadcom is incorporated and currently based in Singapore, but Tan announced late last year while visiting President Donald Trump at the White House that the company would return its corporate headquarters to the U.S., using San Jose as a base.

Buying Qualcomm would make Broadcom the third-largest chip maker, behind Intel Corp. and Samsung Electronics Co. The combined business would become the default provider of a set of components needed to build each of the more than one billion smartphones sold every year.

The company’s hostile takeover attempt has come at a vulnerable time for Qualcomm, which has been embroiled in a long-running legal dispute with Apple and is facing several large fines from governing bodies across the globe. The most recent such fine levied against the San Diego company came from the European Union, which accused Qualcomm of breaking the EU’s antitrust laws to the tune of $1.23 billion. Qualcomm said it would challenge that fine.

If Broadcom is ultimately successful in its takeover attempt, the impact on San Diego could be severe. Qualcomm is one of the few major corporations with a global reach to be headquartered in a city known mainly for tourism, and smaller defense and life sciences firms.

The company is one of the region’s largest private employers, and the family of co-founder Irwin Jacobs is one of the area’s most generous philanthropists.

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