Broadcom proposes to unseat the Qualcomm Board as the acquisition struggle intensifies – tech2.org

Broadcom proposes to unseat the Qualcomm Board as the acquisition struggle intensifies



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Friday is the deadline to propose candidates for director. Broadcom is expected to announce its quarterly earnings on Wednesday afternoon, and can discuss its plans with respect to Qualcomm during the telephone conference scheduled for that day.

"We tried to establish relationships with Qualcomm repeatedly and, in spite of the badistance of shareholders and customers for the transaction, Qualcomm ignored those opportunities," said Broadcom CEO Hock Tan.

"Nominations give Qualcomm shareholders the opportunity to express their disappointment with the directors of Qualcomm and their refusal to enter into discussions with us. "

Broadcom also said that if the 11 nominees were appointed, they would support the expansion of the board to add three current members : Mark D. McLaughlin, Anthony J. Vinciquerra and Jeffrey W. Henderson.

Qualcomm, based in San Diego, gets most of its revenue from the sale of chips, but most of its profits come from the patent royalties it charges to device manufacturers. Qualcomm abruptly advanced its business last year with a $ 38.5 billion agreement to acquire NXP Semiconductors, a transaction that is pending regulatory approval.

Some aspects of Qualcomm's licensing business and other practices have created antitrust challenges around the world, including a complaint from the Federal Trade Commission. Apple, a long-time user of Qualcomm's cellular chips, started a separate legal fight by filing a lawsuit challenging the company's patent license fees.

Broadcom also counts Apple as a key customer for a different clbad of wireless chips. If Broadcom succeeded in taking over Qualcomm, badysts expect Mr. Tan to move forward to end the battle with Apple and modify Qualcomm's licensing practices.

Any purchase of Qualcomm will almost certainly face a lengthy regulatory review. In addition to antitrust concerns, the possibility of sensitive US technology falling into foreign hands would be examined closely by the Foreign Investment Committee in the United States, or CFIUS.

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Broadcom, although administered from San Jose, California, is headquartered in Singapore. Mr. Tan made a commitment before announcing Qualcomm's attempt to move Broadcom's headquarters to the United States, a move that could help him circumvent a CFIUS review, but no new measures have been announced to relocate its headquarters.

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