Earlier on November 6, Broadcom proposed 70 US dollars per share in cash and stock acquisition Qualcomm, the transaction price of more than 100 billion US dollars.But Qualcomm on November 13 rejected the proposed acquisition, said Broadcom's offer underestimated Qualcomm's Value.Thus, Broadcom December 4 publicly nominated 11 candidates for directors, through general election through the General Assembly to replace all members of the current Qualcomm board of directors.
The two sides did not reply to the interview with China Business News, but Broadcom mentioned the uncertainty contained in the fourth quarterly FY2017 FY2017 earnings release, including the possibility of "Broadcom and Qualcomm The final result of the transaction and the uncertainty of the specific terms, including whether Qualcomm will cooperate in the proposed transaction. "Qualcomm was confirmed on December 11 received Broadcom nomination of 11 directors list, and responded to Broadcom's action Is 'openly trying to control the Qualcomm board of directors, thus accelerating the acquisition process'.
An industry close to Qualcomm told reporters, 'Broadcom acquisition of Qualcomm, involving a wide range of mass, the impact of a wide range of industries, is bound to face a strong government regulatory and censorship challenges. And whether the censorship clearance is really necessary Hit a big question mark. 'Core Research Gu Wenjun, chief research said,' Broadcom in the past will be carried out after the spin-off business acquisition, the customer price increases, forcing customers to sign the contract and other financial operations, downstream customers, especially Chinese customers are very Adversely, China should reject its acquisition.
The United States has opposed the waves
Currently, nearly 80% of Qualcomm's shareholding structure is held by institutional shareholders such as BlackRock, Vanguard, State Street and Fidelity, Bank of America and Wells Fargo, Broadcom is unlikely to fully control the Qualcomm board by collecting chips on the market to achieve the goal, it can only affect the institutional shareholders, which in turn affect the Qualcomm board of the general election.
An industry source told reporters that if purely from the market level, the transaction will depend on institutional shareholders for Qualcomm future prospects judgments, 5G commercial gradually approaching, all-intelligent interconnection gradually coming background, after all, Qualcomm is Of course, the acquisition of Qualcomm Broadcom will eventually make its or her debut, not only the market behavior, but also related to the development of the industry and regulatory issues.
According to the latest CNBC report, regulators often take industry into consideration when deciding whether or not to approve a deal, and Qualcomm has made it clear that it is concerned about possible antitrust issues in the deal.
CNBC also quoted people saying that Microsoft and Google both privately expressed concern about the Potential acquisition of Qualcomm by Broadcom because Microsoft and Google are cautious about Apple's possible impact and benefit in the deal, Broadcom "tends to lower costs rather than invest in new technologies, 'the past reputation of concern.
Why did Microsoft and Google oppose the deal because Microsoft just co-released with industry partners the first Windows 10 mobile PC based on the Qualcomm Snapdragon platform and may continue to introduce tablets and hybrid PCs using the Snapdragon platform? Traditional PCs, which will support a unique experience of always-connected and ultra-long battery life, are computationally powerful, not only to help Microsoft gain a bigger market share but also to create a product line that rivals Apple's Macbook and iPad.
For Google, many smartphones and tablets on the market today are powered by Android operating systems, many of which use Qualcomm chips and compete with iPhones and iPads that use the iOS operating system. In the past year or so, Apple's performance in various markets around the world was disappointing. IOS's market share slipped from 22.2% to 13.2%.
Whether it is in China or the global market, Apple's closed iOS system is facing challenges from the open Android camp represented by China's mobile phone manufacturers more crucially, in 4G to 5G technology intergenerational replacement crucial period, China's mobile phone Manufacturers to bring their 4G era of accumulation and advantages in the upcoming era of occupying opportunities in the 5G era is a high probability event.However, if Qualcomm was jointly blocked, acquisitions and weakened, Chinese manufacturers and industries in the 5G era, 'lead' will likely be greatly Discount, facing a lot of uncertainty.
In fact, Broadcom and Qualcomm are both Apple's biggest clients, and Broadcom chief executive Hock Tan has stated in a public press release that originally announced plans to acquire Qualcomm, 'If we are not going to be accepted by a common global customer, Proposed terms are confident we will not make the offer. "Hock Tan, privately at Qualcomm and Apple Worldwide, said privately that Broadcom's acquisition of Qualcomm would help solve the problems of Qualcomm and Apple Litigation.
If Qualcomm was acquired by Broadcom, tantamount to Apple's victory, of course, is equivalent to the Windows system and the Andrew system, a major defeat.So, Microsoft and Google and other US companies believe that an independent Qualcomm will benefit the more diversified development of the entire industry .
Broadcom acquisition history cited uneasy
In addition, Hock Tan, which led Avago Capital in its $ 6.6 billion acquisition of LSI Corp. in 2013, spent $ 37 billion on Broadcom acquisition in 2015 and sold IoT at a high price in the process of integrating 'New Broadcom' Business department and a series of actions, but in the United States science and technology sector is regarded as 'barbarian capital markets'.
This has also aroused the dissatisfaction of the tech giants that emphasize 'innovation', so that some media are already speculating that if Broadcom succeeds in acquiring Qualcomm, how Broadcom will split Qualcomm.
Avago's predecessor can be traced back to Hewlett-Packard, the initial main business is the industrial-grade chips; after the acquisition of LSI, an increase of memory chip business; Broadcom acquired and merged into a new Broadcom after the addition of data chip business and Wi-Fi Chip business.
Qualcomm's main business is 3G, 4G and next-generation wireless communications technology, and mobile communications technology licensing business, in recent years also actively to the field of all-intelligent interconnection layout.
In Gu Wenjun view, from the industrial point of view, Broadcom and Qualcomm's main business does not exist between the synergies too much, the merger or more capital-level operation, is good at capital operation Broadcom is likely to After buying Qualcomm, leaving what it considers to be the most valuable part and selling the rest elsewhere, the regulator must recognize the question of whether the deal is "surrendering" or "surname."
Before the Nov. 6 announcement of the acquisition of Qualcomm, that is, on November 2, Hock Tan met with U.S. President Trump at the White House and announced the relocation of Broadcom's headquarters to the United States. He also claimed that the Republican tax reform plan was Broadcom's decision to transfer headquarters One of the reasons to move to the United States.
Broadcom has been headquartered in San Jose, California, but relocated to Singapore two years ago for tax reasons.Hock Tan, a Malaysian Chinese-rich businessman, apparently pleads Trump in an attempt to gain U.S. support for Broadcom .
Or have a significant impact on the Chinese market
The industry believes that Broadcom and Qualcomm are two distinct companies.Barton is more inclined to serve Apple, Samsung and other major customers, other than the service is not the focus of customers, and with this strategy to enhance their chip sales profit ; And Qualcomm is often focused on the 5 to 10 years after the technical reserves, in the past in the 3G, 4G era is now the same in the 5G key core technologies, although this means that Qualcomm's huge R & D investment to at least 5 to 10 years later In order to be rewarded, but Qualcomm's strategy for the entire mobile communications industry benefit.
Therefore, once Broadcom succeeds in acquiring Qualcomm, its quick and easy way of making money will inevitably affect QUALCOMM's long-term investment in R & D of new generation technologies, which is detrimental to the development of the entire industry.
At the same time, Gu Wenjun believes that once Broadcom started the acquisition of Qualcomm, it will certainly involve the transaction monopoly, whether the approval of regulatory agencies and other issues, if you want to complete the mergers and acquisitions, not only the attitude of the United States regulators is very important, whether it can be through other countries, Antitrust scrutiny is also crucial in areas such as China and the EU, and Gu Wenjun directly appeals to Chinese regulators to 'reject the merger'.
Why China should refuse? On the one hand because Qualcomm long-term deep plowing the Chinese market, in 3G, 4G and the upcoming 5G era and China's mobile communications industry all parties have maintained close cooperation and made extensive investments in China. For example, with SMIC in the successful 28-nanometer manufacturing process cooperation, is currently working on 14-nanometer process technology research and development, and support for SMIC into the 14-nanometer process bump camp to help them 10-nanometer process bump technology Certification, etc., greatly shortening the gap between China's chip manufacturing process and the world's advanced level.
At the same time, Qualcomm and Guizhou Provincial Government jointly set up Huasun Tong Semiconductor Technology Co., Ltd. for data center server chip design and development, and Chuang Ke Zhuang 'stock assessment' in Chongqing and other places in the field of IoT common development and innovation.
'Qualcomm cooperation projects with the government in China are all the major breakthrough areas of the state and government.Compared with Qualcomm, we rarely see Broadcom and the Chinese government and related enterprises have technical cooperation.Once the acquisition of Qualcomm Qualcomm Qualcomm Whether these projects made by China will be endorsed and will continue to exist will probably raise a big question mark. "The insiders told reporters.
On the other hand, although QUALCOMM serves Broadcom like Apple and Samsung, QUALCOMM has a strategic market in China and has a partnership with over 150 Chinese companies, and if Broadcom buys Qualcomm, these Chinese vendors will be treated as Broadcom Will become a big question. 'After Broadcom has been very hard to chip prices about 15%, and forcing manufacturers to sign a long-term cooperation agreement precedent.' The industry believes that, according to Broadcom go practice, the Chinese manufacturers can Enjoy the same preferential treatment as large customers such as Apple, Samsung will become a big question.
In fact, despite the interference with Broadcom acquisition, but Qualcomm did not stop in the Chinese market to step up investment in the Nov. 15 Qualcomm Ventures and Innovation Summit, Qualcomm Ventures announced investment, including Shang Tang Science and technology, motorcycles, creators of electronic, resistance, zero element, the United States science and technology, fantasy science and technology, Aile Qi, Ao Kemei, including nine Chinese enterprises.
Public information, Qualcomm Ventures from 2015 began to focus on expanding to artificial intelligence, Internet of Things, VR / AR, robot 'stock assessment' and other fields, the current investment in China has more than 40 companies, including millet technology , TouchPal technology 'unicorn' level of start-up companies.