Qualcomm's board of directors unanimously rejected an acquisition proposal from competitor Broadcom, the company announced on Thursday.
Broadcom had proposed acquiring all outstanding shares of Qualcomm for $82 per share, which breaks down to $60.00 in cash and $22 in Broadcom stock. Broadcom previously described the $121 billion as its "best and final offer."
In a letter from Qualcomm chairman Paul Jacobs to Broadcom CEO Hock Tan, the board detailed their decision.
"The Board has unanimously determined that your amended offer materially undervalues Qualcomm and falls well short of the firm regulatory commitment the Board would demand given the significant downside risk of a failed transaction," Jacobs wrote in the letter.
Jacobs didn't completely strike out the prospect of a deal. He said the Qualcomm board would be open to meeting with Broadcom to explore "all options for maximizing shareholder value," but reiterated the board's view that the proposal is "inferior" relative to Qualcomm's prospects as an independent company.
He also laid out questions for Broadcom should the two companies meet, including whether $82 per share really is Broadcom's highest offer, and just how far Broadcom was willing to go to close the deal.
Qualcomm struck down a previous acquisition offer from Broadcom in November 2017, using a similar argument. Broadcom had offered to purchase Qualcomm stock at $70 per share.
In December, Qualcomm rejected director nominees picked by Broadcom and private-equity firm Silver Lake Partners, setting the stage for a proxy battle between the chipmakers.
proposed by Broadcom and Silver Lake Partners to replace Qualcomm's current directors.
This story is developing. Please check back for updates.