Qualcomm said it is nearing an agreement with Broadcom on issues other than price in the latter's proposed takeover of Qualcomm. The two companies met a second time on 23 February and Qualcomm released a letter to Broadcom outlining its stance on the discussions. Qualcomm reiterated that it still finds the price offered by Broadcom, including its earlier higher bid of USD 82 per share, too low, but the company is open to starting due diligence in order to come to a better offer.
Qualcomm said its board believes the latest meeting led to further progress toward a possible negotiated transaction on key issues other than price, notably how to approach possible regulatory opposition to the merger. The board sent Broadcom a mark-up of Broadcom’s previously released draft merger agreement that, if agreed to by Broadcom, would resolve all issues between the two companies other than price.
Qualcomm defended its growth forecasts again, saying the problems with its licensing business were of a short-term nature and should not be used as a basis for the takeover bid. It also called for Broadcom to open up on how it plans to restructure the licensing business. Such information could be disclosed to a neutral third party, such as a law firm with antitrust expertise, Qualcomm said.
To come to a better valuation, the company said it's ready to enter into due diligence with Broadcom, after signing a non-disclosure agreement. Qualcomm proposed the companies next meeting be focused on price negotiations.
Broadcom called Qualcomm's statement "disingenuous" and suggested it was an attempt to delay the company's AGM in early March, at which Broadcom has proposed an alternative slate of directors. Broadcom said its bid had never been conditional on due diligence and it saw no need to draw out the process prior to agreeing a price.
At their meeting 23 February, Qualcomm refused to confirm the AGM will go ahead on 06 March, Broadcom said. The company added that the process outlined by
According to a separate report from the Financial Times, Qualcomm is seeking a price of around USD 160 billion from Broadcom, compared to the company's original offer of around USD 130 billion including debt.
