Broadcom, a wireless chip maker, is officially offering $130 billion for Qualcomm. The deal would be the largest tech acquisition in history, but Broadcom is going to face a difficult negotiation period and likely fights with regulators. Its offer is a 30% premium over Qualcomm's current stock price, which has fallen due to patent fights and trouble with regulators.
Sources speaking with Bloomberg indicate Qualcomm isn't pleased with this offer. It wasn't looking for a takeover attempt and it's going to encourage shareholders to reject the offer. Even though their potential stock benefits, which are being touted by Broadcomm, may look nice, Qualcomm says the deal would likely just get caught in regulatory battles for an extended period.
We would not make this offer if we were not confident that our common global customers would embrace the proposed combination. Our proposal provides Qualcomm stockholders with a substantial and immediate premium in cash for their shares, as well as the opportunity to participate in the upside potential of the combined company. - Hock Tan, CEO, Broadcom