Broadcom Prepares for Proxy Battle If Qualcomm Rejects Bid

Broadcom Threatens Qualcomm With Hostile Takeover

Broadcom Ltd. and its advisers are gearing up for a proxy battle, making an appeal directly to shareholders, should Qualcomm Inc. reject its $105 billion takeover offer, according to a person with knowledge of the matter.

Under Chief Executive Officer Hock Tan, Broadcom wouldn’t have made the proposal if it weren’t prepared to go hostile, said the person, who asked not to be identified discussing private negotiations.

Broadcom is proposing $70 a share in cash and stock for Qualcomm, using what would be the largest technology deal ever to become a top provider of chips used in mobile phones.

Qualcomm said it’s assessing the overture, but people with knowledge of the matter said the company is prepared to reject it. The company believes $70 a share undervalues Qualcomm, and it’s concerned that regulators will stand in the way of a combination that gives one company so much sway over the market for components used to make wireless devices, the people said.

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