Barely a week goes by without a new story involving Qualcomm. Be it antitrust cases or the ongoing patent spat with Apple, the last six months or so have proven to be quite the headache for the US chipmaker. However, it may be about to be offered a $100 billion way out of its troubles.
According to the Financial Times Broadcom is lining up a record bid for Qualcomm. The move would easily eclipse the previous record-setting bid from Qualcomm to buy NXP (which has yet to clear). As part of the reported deal, Broadcom would be willing to honour the NXP agreement.
Neither Qualcomm or Broadcom has confirmed anything, however shares in Qualcomm have risen by some 13 per cent, suggesting that the Financial Times report has legs. Likewise share prices in Broadcom have shot up by some 6 per cent since the reports of a takeover began to surface.
A formal announcement is expected today, with some reports suggesting that negotiations had been worked over this weekend. Broadcom recently announced intentions to ‘redomicile’ as a US-based company instead of being based out of Singapore. Many thought that was an attempt to complete a much smaller acquisition of Brocade, but it now looks as if Broadcom have loftier goals in their sights.
Broadcom is well established within the mobile chips and telecoms industry. However it doesn’t pack much of a market punch when it comes to LTE and 5G chips. That is where the Qualcomm acquisition would provide particularly fruitful for Broadcom, who could utilise Qualcomm resources to acquire a greater presence in the smartphone and IoT spheres.