Mergers and acquisitions are a fairly common occurrence in the technology industry in today’s day and age. New and exciting technologies are on the horizon, and the industry is constantly consolidating as industry giants try to evolve and get a leg up on their competitors. This is especially true of the mobile chip industry, which has been undergoing a wave of consolidation over the past few years. However, the single most audacious potential acquisition is the one everyone is talking about these days – the proposed takeover of mobile chip giant Qualcomm Inc. (NASDAQ:QCOM) by rivals Broadcom Ltd. (NASDAQ:AVGO).
Back in November last year, we reported on Broadcom’s brazen attempt to take over their biggest competitor, Qualcomm, in a deal valued at $130 billion! The proposed deal had the potential to completely change the face of the semiconductor industry and could have had far-reaching effects on the smartphone industry as well. Qualcomm eventually went on to reject multiple bids from Broadcom, and the deal quickly turned hostile.
Amidst all the attrition, another major player has decided to throw their hat into the ring. PC chip-making giant Intel Corporation (NASDAQ:INTL) is now reportedly considering a massive bid for Broadcom!
The latest development leads us to few head-scratching questions:
- Why is Intel looking to buy Broadcom while Broadcom is embroiled in their own hostile takeover attempt of Qualcomm?
- What benefits would Intel gain from such a deal?
- Will Intel go through with the deal even though the Broadcom–Qualcomm merger looks to have fallen apart?
While the situation has created a three-party tug of war, taking a deep dive to find the answers of above questions would be a kind of an exciting ride.