Qualcomm has officially rejected a blockbuster takeover bid by Broadcom worth $130bn.
The deal - potentially the largest ever in tech and made a week ago - was unanimously rejected by Qualcomm's board because the offer "dramatically undervalues Qualcomm" and also faces "significant regulatory uncertainty".
“It is the board’s unanimous belief that Broadcom’s proposal significantly undervalues Qualcomm relative to the company’s leadership position in mobile technology and our future growth prospects,” said Qualcomm executive chairman Paul Jacobs.
The company's chief executive Steve Mollenkopf said: "No company is better positioned in mobile, IoT [Internet of Things], automotive, edge computing and networking within the semiconductor industry. We are confident in our ability to create significant additional value for our stockholders as we continue our growth in these attractive segments and lead the transition to 5G."
The offer had been expected to be rejected despite Broadcom's chief executive and president, who also happens to be a serial dealmaker, Hock Tan outlining how well the two would work together.
Shares in Qualcomm inched up one per cent on the announcement while Broadcom shares remained largely flat in pre-market trading.
Analysts had cited the low-ball bid of $70 per share (a 20 per cent premium on its closing price prior to news of the deal) and the regulatory hurdle of getting approval from US authorities as reasons that the deal was likely to be rejected.