Qualcomm rejects Broadcom's revised $121B buyout offer

Chipmaker Qualcomm rejected a revised, $121 billion buyout offer from Broadcom on Thursday but suggested the two companies meet to address what it called the proposal's "serious deficiencies in value and certainty."

San Diego, California-based Qualcomm said Broadcom's proposal to acquire all outstanding shares of the chipmaker for $82 per share "materially undervalues" Qualcomm and doesn't adequately address the risk that the transaction could fail because of antitrust concerns.

Broadcom, which makes chips for everything from cable modems to set-top boxes and digital video recorders, first launched an unsolicited bid for Qualcomm, the world's largest maker of chips and processors for phones, in November, for $70 a share, or $105 billion. The acquisition would have been the biggest in tech history, surpassing AOL's buy of Time Warner in 2001.

A combination of the two companies would create a chip giant supplying components to a wide array of electronic gadgets found in your home or pocket. A deal would also mark a surprising turnaround from nearly a decade ago, when the companies were bitter courtroom rivals.

But a week after Broadcom's original offer, Qualcomm rejected the proposal, saying the price tag wasn't high enough.

In a letter to Broadcom CEO Hock Tan on Thursday, Qualcomm Chairman Paul Jacobs addressed concerns about a deal falling through.

"If you are not willing to agree to do whatever is necessary to ensure a transaction closes," Jacobs wrote, "we will need you to be extremely clear and specific about exactly what actions you would refuse to take, so that we can properly evaluate the risk to Qualcomm's shareholders."

Broadcom didn't immediately respond to a request for comment.

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