Qualcomm issued a statement on December 4 confirming the receipt of Broadcom’s nomination of a slate of candidates to replace Qualcomm’s existing Board of Directors at the company’s 2018 Annual Meeting of Stockholders. Qualcomm perceived the move as a “blatant attempt to seize control of the Qualcomm Board.”
“Qualcomm is exceptionally well positioned – with technology and leadership positions across mobile, IoT, Automotive, edge computing and networking – and leading the transition to 5G,” Qualcomm said in a statement. “Qualcomm stockholders are poised to participate in substantial growth and value creation as the company continues to execute its strategy across its businesses.”
On November 13, 2017, Qualcomm’s Board of Directors unanimously rejected Broadcom’s non-binding, unsolicited proposal to acquire Qualcomm for per share consideration of $60.00 in cash and $10.00 in Broadcom stock. After a comprehensive review, conducted in consultation with its financial and legal advisors, the Board concluded that Broadcom’s proposal “undervalues Qualcomm and comes with significant regulatory uncertainty, and therefore is not in the best interests of Qualcomm stockholders.”
Qualcomm expressed concern with Broadcom’s lack of committed financing, and the uncertainty surrounding its transition from Singapore to the United States. Qualcomm’s Board is composed of 11 directors, 9 of whom are independent and 4 of whom have been added in the last 3 years, and all of whom are “firmly committed to acting in the best interests of all Qualcomm stockholders.”
Qualcomm said Broadcom’s actions represent a “blatant attempt to seize control of the Qualcomm Board in order to advance Broadcom’s acquisition agenda. These nominees are inherently conflicted given Broadcom’s desire to acquire Qualcomm in a manner that dramatically undervalues Qualcomm to Broadcom’s benefit.”
Tom Horton, Qualcomm’s Presiding Director, said, “No company in the industry is better positioned than Qualcomm in mobile, IoT, automotive, edge computing and networking to lead the transition to 5G.” He said Qualcomm stockholders expect a Board that will “support this innovation while evaluating objectively the full range of opportunities available to maximize value for all Qualcomm stockholders.”