Qualcomm and Broadcom met on Valentine’s Day to discuss Broadcom’s unsolicited bid, but the two sides apparently did not make a love connection.
However, Qualcomm is still willing to go on another date and continue the courtship.
In a letter from the Qualcomm board chairman and the rest of the board to Broadcom president and CEO Hock Tan, the fellow chipmaker said Broadcom’s “best and final proposal” of $82 per share still “materially undervalues Qualcomm and has an unacceptably high level or risk, and therefore is not in the best interests of Qualcomm stockholders.”
However, the Qualcomm board said it found the meeting to be constructive in that Broadcom expressed a willingness to agree to certain potential antitrust-related divestitures beyond those that Broadcom had already expressed.
But there are other roadblocks that Qualcomm found, adding that Broadcom continues to resist agreeing to other commitments that could be expected as requirements from government and regulatory bodies such as the FTC, the European Commission, and MOFCOM.
“Broadcom also declined to respond to any questions about its intentions for the future of Qualcomm’s licensing business, which makes it very difficult to predict the antitrust-related remedies that might be required,” Qualcomm said, adding that the board is open to further discussions.
Update: Broadcom has yet to issue a statement following the meeting. But speaking today on CNBC’s Squawk on the Street, David Faber said: “The way it’s been termed to me, more on the Broadcom side, is it was a non-substantive discussion and a waste of time.”
This latest chapter comes after Broadcom announced it had secured funding for its sweetened bid ($60 per share in cash and $22 in Broadcom stock), and that it would cut the number of nominees it would seek for Qualcomm’s board, from 11 to six.