On Tuesday Qualcomm (QCOM 63.24, -0.75, -1.2%) raised its offer to acquire NXP Semiconductors (NXPI 125.81, +0.25, +0.2%) from $110.00 per share in cash to $127.50 per share. There was little doubt that NXPI shareholders were loving that news and there is little doubt that Broadcom (AVGO 252.66, +3.04, +1.2%) has real disdain for it.
Broadcom is in a hostile battle to acquire Qualcomm and has been chagrined that Qualcomm's Board of Directors hasn't been more receptive of its proposal, which incorporates an $82.00 per share cash-and-stock offer, as well as an $8 billion regulatory reverse termination fee.
The latter had been deemed by Broadcom to be a "best and final" offer, but in light of Qualcomm's increased offer to acquire NXP Semiconductors, Broadcom has amended its offer to $79.00 per share ($57 in cash and $22 in Broadcom stock), claiming Qualcomm's board transferred $4.10 per Qualcomm share (or $6.2 billion of value) to NXP stockholders.
Broadcom added, however, that it would trigger the $82.00 per share offer ($60 in cash and $22 in Broadcom stock) if the NXP acquisition is not completed.
Qualcomm for its part has said Broadcom's best and final offer simply does not reflect the true value of Qualcomm shares. That clarification came after the two sides met on Valentine's Day to discuss the proposal and other matters like antitrust concerns.
Qualcomm's board said it remains open to discussions with Broadcom, but knowing it raised the offer for NXP after the Valentine's Day meeting with Broadcom goes to show that it isn't going to acquiesce to Broadcom's position on matters pertaining to the acquisition of NXP or to Broadcom's proposed acquisition of Qualcomm.
The market seems to be seeing things the way Qualcomm is seeing things. The proof is in the stock price.
Shares of QCOM are trading around $63.00, which is well below Broadcom's original offer of $70.00 per share, the best and final offer of $82.00 per share, and today's reduced offer of $79.00 per share.
In all cases so far, those prices just haven't been right to convince Qualcomm's board to do a deal with Broadcom or to convince the market that a Broadcom buyout of Qualcomm will get done.