"[The deal] has sent shock waves through the whole tech sector," the "Mad Money" host said. "The thing about technology is that many skeptics just don't understand how the industry has gotten so much bigger, which means these companies are a lot more valuable to each other than you might think."
Cramer said that the "bombshell" factor of Broadcom's takeover bid came largely from the fact that it was hostile, which is unusual for the tech space.
But Broadcom, which provides the most Apple smartphone components than any company in the world, might not see this deal completed, the "Mad Money" host continued.
"The odds of this deal actually being completed seem pretty long," Cramer said. "Qualcomm's stock has been held back by its squabble with Apple. Its board of directors knows that the share price would probably be worth more than where it's currently trading and they don't want to give the company away."
But if Apple wins the companies' prolonged legal battle, Cramer said that Qualcomm's shareholders would likely be more open to Broacom's offer, no matter the price.
And Cramer was behind the reasoning for the deal.
"Put simply, as in many other industries, we have too many semiconductor companies and they're competing for too little business. But if you can combine companies, you end up saving money while building up more bargaining power with your customers, and that's a win," he said.
Cramer added that bearish analysts and market-watchers who claim that the market's "done for" are often making claims solely from earnings estimates, not takeover values, which Cramer said tend to paint a better picture of strategic worth.
"[The deal shows] you the worth of these chipmakers beyond simply what we're willing to pay for their earnings per share," the "Mad Money" host said. "Analysts have earnings models. [Broadcom CEO] Hock Tan, for instance, has franchise models, and that's why he wants to buy Qualcomm."
Tech, particularly the semiconductor space, has become about so much more than smartphone and personal computer chips, Cramer argued.
With industrial automation and machine learning on the rise, companies now need semiconductors for more applications than many people on Wall Street even consider, he said.
"The skeptics want to judge stocks based on their price-to-earnings multiples, which seem to get more expensive by the day. But when you look at companies the way CEOs and entrepreneurs do, as takeover targets, then there's a lot more value in this market than you might think if you only looked at a spreadsheet," the "Mad Money" host said. "Don't get me wrong, on an earnings basis, stocks have definitely come too far, but in the real world, there's much more than one way to value a company: the cost of buying all the shares, not just a percent of the shares like a regular money manager would. And right now, merger potential is driving this market as much as anything else."
Disclosure: Cramer's charitable trust owns shares of Broadcom.