Qualcomm’s board of directors has thrown out Broadcom’s $103 billion takeover bid. A statement release by Qualcomm said that the board had ‘unanimously rejected the unsolicited proposal announced by Broadcom’. The chairman of the board, Paul Jacobs, said that Qualcomm felt the bid massively undervalued its true value.
“It is the Board’s unanimous belief that Broadcom’s proposal significantly undervalues Qualcomm relative to the Company’s leadership position in mobile technology and our future growth prospects,” Jacobs said.
Meanwhile, Tom Horton, presiding director for Qualcomm, said: “The Board and Management are singularly focused on driving value for Qualcomm’s shareholders. After a comprehensive review, conducted in consultation with our financial and legal advisors, the Board has concluded that Broadcom’s proposal dramatically undervalues Qualcomm and comes with significant regulatory uncertainty. We are highly confident that the strategy Steve and his team are executing on provides far superior value to Qualcomm shareholders than the proposed offer.”
And CEO Steve Mollenkopf said that Qualcomm well positioned for continual growth. “No company is better positioned in mobile, IoT, automotive, edge computing and networking within the semiconductor industry. We are confident in our ability to create significant additional value for our stockholders as we continue our growth in these attractive segments and lead the transition to 5G,” said Mollenkopf.
His comments come on the back of the Qualcomm reaching agreements with three Chinese smartphone vendors. Qualcomm announced that it had signed non-binding deal worth around $12 billion, as part of broader agreements signed during US President Donald Trump's first state visit to China, underscoring the strength of commercial partnerships between the world's two largest economies.
Under the ‘memorandums of understanding’, Xiaomi, Oppo Electronics and Vivo Mobile Communication Technology said they plan to buy smartphone components, mostly chips, from Qualcomm over the next three years.