Broadcom, which is based in Singapore but has announced plans to return to the United States, last month offered to pay $70 per share for Qualcomm in a deal that values the San Diego-based chipmaker at $130 billion including $25 billion in net debt.
Qualcomm criticized Broadcom's proposed acquisition and highlighted the many uncertainties associated with it, including regulatory hurdles and lack of committed financing. It has been considering an improved bid, and will likely present it by March, based on the reception its board director slate receives from Qualcomm shareholders, the sources added.
Qualcomm shareholders who want the company to engage in sale talks will be able to vote on Broadcom's board director slate on March 6. The deadline for director nominations for consideration at that meeting falls on December 8.
"Qualcomm stockholders expect a board that will support this innovation while evaluating objectively the full range of opportunities available to maximise value for all Qualcomm stockholders". He said that despite the looming proxy battle, "it remains our strong preference to engage in a constructive dialogue with Qualcomm".
Broadcom has lined up nine men and two women as board director nominees, many of them with much experience in the technology sector, the sources said on Sunday.
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Tan said he would rather see Qualcomm negotiate a truce and accept Broadcom's offer, instead of having to take the fight over Qualcomm's future to its shareholders.
Tan said Broadcom had received "positive feedback from customers" about the proposed merger and was confident that regulatory requirements could be made.
"No company in the industry is better positioned than Qualcomm in mobile, IoT, automotive, edge computing and networking and to lead the transition to 5G", added Tom Horton, Qualcomm's Presiding Director.
Qualcomm's board current board consists of company executives, including CEO Steve Mollenkopf and former CEO Paul E. Jacobs, private equity investors, consultants and executives at tech companies.
He said Broadcom representatives have been repeatedly rebuffed in their attempts to engage Qualcomm officials. That offer marked a 28% premium over Qualcomm shares at the time. Qualcomm said the offer undervalues the company.