Last November, Broadcom offered Qualcomm, the company widely known for its Snapdragon chips used in smartphones, a $70 per share buyout. However, a week later, the U.S. semiconductor's board unanimously voted against the said takeover, due to it reportedly undervaluing the chipmaker. Earlier this month, the Singapore-based company revised the offer up to $82 a share - broken down as $60 in cash, and $22 in Broadcom stock - however, this offer was rejected yet again on Thursday.
Citing a similar reason for rejecting as it did previously, Qualcomm's Chairman Paul Jacobs explained:
"The Board has unanimously determined that your amended offer materially undervalues Qualcomm and falls well short of the firm regulatory commitment the Board would demand given the significant downside risk of a failed transaction,"
Although Jacobs did not explicitly rule out any deal, he did note that prior deals were inferior to the possible prospects Qualcomm could have as an independent company. He also noted that the company would be open to meeting with the Broadcom board, aiming to question the $82 a share bid as truly the 'best and final offer'. It would also push to see how far its rival will go to secure the takeover.
Qualcomm has been under pressure lately, after a KGI Securities report cast doubts on the future of the company, noting that Apple could drop its modems in favor of those manufactured by Intel in the next-generation of iPhones. The company is also accused of anti-competitive practices, including a recent $1.2 billion fine issued by the European Union due to the chipmaker 'flouting EU regulations' by paying Apple billions not to use chips made by its competitors. Due to these fines, the company's profitability was seriously impacted during the fourth quarter of 2017.
At the time of publishing, Qualcomm's share price was trading at $62.42 per share, with a market valuation of $92 billion.