SAN JOSE, Calif., Jan. 16, 2018 /PRNewswire/ -- Broadcom
Limited (NASDAQ: AVGO) ("Broadcom") today issued a statement
in response to the announcement by Qualcomm Incorporated (NASDAQ:
QCOM) ("Qualcomm") regarding its standalone approach.
Despite the clear customer and
stockholder support for the value-maximizing transaction proposed
by Broadcom, Qualcomm has refused to engage with Broadcom and has
instead elected to remain a standalone company, which fails to
address Qualcomm's fundamental business challenges, including its
ongoing disputes with customers and regulatory investigations in
numerous jurisdictions.
Qualcomm management has repeatedly
overpromised and under-delivered since the announcement of its
"strategic realignment plan" in 2015, resulting in an inability to
meet financial targets as well as deteriorating profitability and
destruction of stockholder value. Qualcomm's approach is a
transparent attempt to sell a quick fix by the Qualcomm Board of
Directors and management team and an obvious tactic to deny its own
stockholders the opportunity to receive a compelling premium for
their shares and significant upside potential in the combined
company.
Based on the highly complementary
nature of the businesses of the two companies, Broadcom's extensive
experience in completing complex, cross-border acquisitions and
initial meetings with several relevant antitrust authorities,
Broadcom remains very confident that the regulatory requirements
necessary to complete a combination will be met in a timely manner
and expects that the proposed transaction would be completed within
approximately 12 months following the signing of a definitive
agreement. It is important that Qualcomm engage with us so that
Qualcomm stockholders can realize the significant value that
Broadcom is offering.
On November 6, 2017, Broadcom
proposed to acquire all of the outstanding shares of Qualcomm for
per share consideration of $70.00 in
cash and stock, consisting of $60.00
in cash and $10.00 in Broadcom
shares. Broadcom's offer represents a 28% premium over the closing
price of Qualcomm's common stock on November
2, 2017, the last unaffected trading day prior to media
speculation regarding a potential transaction, and a premium of 33%
to Qualcomm's unaffected 30-day volume-weighted average price. The
Broadcom proposal stands whether Qualcomm's pending acquisition of
NXP Semiconductors N.V. ("NXP") is consummated on the currently
disclosed terms of $110 per NXP share
or is terminated.
On January 5, 2018, Broadcom filed
definitive proxy materials in connection with its solicitation of
proxies to elect 11 independent, highly qualified nominees to the
Qualcomm Board of Directors at Qualcomm's 2018 Annual Meeting of
Stockholders, scheduled for March 6,
2018.
Moelis & Company LLC, Citi, Deutsche Bank, J.P. Morgan, BofA
Merrill Lynch, Morgan Stanley and Wells Fargo Securities are acting
as financial advisors to Broadcom. Wachtell, Lipton, Rosen &
Katz and Latham & Watkins LLP are acting as legal counsel.
More information regarding Broadcom's proposal for Qualcomm can
be found by visiting www.AVGO-QCOM.com.
About Broadcom Limited
Broadcom Limited (NASDAQ:AVGO) is a leading designer, developer
and global supplier of a broad range of digital and analog
semiconductor connectivity solutions. Broadcom Limited's extensive
product portfolio serves four primary end markets: wired
infrastructure, wireless communications, enterprise storage and
industrial & other. Applications for our products in these end
markets include: data center networking, home connectivity, set-top
box, broadband access, telecommunications equipment, smartphones
and base stations, data center servers and storage, factory
automation, power generation and alternative energy systems, and
electronic displays.
Cautionary Note Regarding Forward-Looking
Statements
This announcement contains forward-looking statements (including
within the meaning of Section 21E of the United States Securities
Exchange Act of 1934, as amended, and Section 27A of the United
States Securities Act of 1933, as amended) concerning Broadcom.
These statements include, but are not limited to, statements that
address our expected future business and financial performance and
statements about (i) the proposed transaction involving Broadcom
and Qualcomm and the expected benefits of the proposed transaction,
(ii) the expected benefits of acquisitions, (iii) our plans,
objectives and intentions with respect to future operations and
products, (iv) our competitive position and opportunities, (v) the
impact of acquisitions on the market for our products, and (vi)
other statements identified by words such as "will", "expect",
"believe", "anticipate", "estimate", "should", "intend", "plan",
"potential", "predict", "project", "aim", and similar words,
phrases or expressions. These forward-looking statements are based
on current expectations and beliefs of the management of Broadcom,
as well as assumptions made by, and information currently available
to, such management, current market trends and market conditions
and involve risks and uncertainties, many of which are outside
Broadcom's and management's control, and which may cause actual
results to differ materially from those contained in
forward-looking statements. Accordingly, you should not place undue
reliance on such statements.
Particular uncertainties that could materially affect future
results include risks associated with our proposal to acquire
Qualcomm, including: (i) uncertainty regarding the ultimate outcome
or terms of any possible transaction between Broadcom and Qualcomm,
including as to whether Qualcomm will cooperate with us regarding
the proposed transaction, (ii) the effects of the announcement of
the proposed transaction on the ability of Broadcom and Qualcomm to
retain customers, to retain and hire key personnel and to maintain
favorable relationships with suppliers or customers, (iii) the
timing of the proposed transaction, (iv) the ability to obtain
regulatory approvals and satisfy other closing conditions to the
completion of the proposed transaction (including shareholders
approvals), and (v) other risks related to the completion of the
proposed transaction and actions related thereto; any loss of our
significant customers and fluctuations in the timing and volume of
significant customer demand; our dependence on contract
manufacturing and outsourced supply chain; our dependency on a
limited number of suppliers; any acquisitions we may make, such as
delays, challenges and expenses associated with receiving
governmental and regulatory approvals and satisfying other closing
conditions, and with integrating acquired companies with our
existing businesses and our ability to achieve the growth prospects
and synergies expected by such acquisitions; our ability to
accurately estimate customers' demand and adjust our manufacturing
and supply chain accordingly; our significant indebtedness,
including the need to generate sufficient cash flows to service and
repay such debt; dependence on a small number of markets and the
rate of growth in these markets; dependence on and risks associated
with distributors of our products; dependence on senior management;
quarterly and annual fluctuations in our operating results; global
economic conditions and concerns; our proposed redomiciliation of
our ultimate parent company to the United
States; our competitive performance and ability to continue
achieving design wins with our customers, as well as the timing of
any design wins; prolonged disruptions of our or our contract
manufacturers' manufacturing facilities or other significant
operations; our ability to improve our manufacturing efficiency and
quality; our dependence on outsourced service providers for certain
key business services and their ability to execute to our
requirements; our ability to maintain or improve gross margin; our
overall cash tax costs, legislation that may impact our overall
cash tax costs and our ability to maintain tax concessions in
certain jurisdictions; our ability to protect our intellectual
property and the unpredictability of any associated litigation
expenses; any expenses or reputational damage associated with
resolving customer product warranty and indemnification claims;
cyclicality in the semiconductor industry or in our target markets;
our ability to sell to new types of customers and to keep pace with
technological advances; market acceptance of the end products into
which our products are designed; and other events and trends on a
national, regional and global scale, including those of a
political, economic, business, competitive and regulatory
nature.
Our filings with the Securities and Exchange Commission ("SEC"),
which you may obtain for free at the SEC's website at
http://www.sec.gov, discuss some of the important risk factors that
may affect our business, results of operations and financial
condition. We undertake no intent or obligation to publicly update
or revise any of these forward looking statements, whether as a
result of new information, future events or otherwise, except as
required by law.
Additional Information
This communication does not constitute an offer to buy or
solicitation of an offer to sell any securities. This
communication relates to a proposal which Broadcom has made for an
acquisition of Qualcomm and Broadcom's intention to solicit proxies
for the election of Broadcom nominees to the Qualcomm Board and
certain other proposals at Qualcomm's 2018 annual meeting of
stockholders. Broadcom has filed a preliminary proxy
statement on Schedule 14A with the SEC on December 11, 2017 in connection with the
solicitation of proxies for Qualcomm's 2018 annual meeting of
stockholders. Broadcom expects to file a definitive proxy
statement with the SEC in connection with the solicitation of
proxies for Qualcomm's 2018 annual meeting of stockholders and may
file other proxy solicitation materials in connection
therewith.
In addition, in furtherance of the acquisition proposal and
subject to future developments, Broadcom (and, if a negotiated
transaction is agreed, Qualcomm) may file one or more registration
statements, proxy statements, tender offer statements or other
documents with the SEC. This communication is not a
substitute for any proxy statement, registration statement, tender
offer statement, prospectus or other document Broadcom and/or
Qualcomm may file with the SEC in connection with the proposed
transaction.
Investors and security holders of Broadcom and Qualcomm are
urged to read the proxy statement(s), registration statement(s),
tender offer statement(s), prospectus(es) and/or other documents
filed with the SEC carefully in their entirety if and when they
become available as they will contain important information about
the proposed transaction and solicitation. Any definitive
proxy statement(s) or prospectus(es) (if and when available) will
be mailed to stockholders of Broadcom and/or Qualcomm, as
applicable. Investors and security holders will be able to
obtain free copies of these documents (if and when available) and
other documents filed with the SEC by Broadcom through the web site
maintained by the SEC at http://www.sec.gov.
This document shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except
by means of a prospectus meeting the requirements of Section 10 of
the U.S. Securities Act of 1933, as amended.
Participants in Solicitation
Broadcom, certain of its subsidiaries, its directors and
executive officers, other members of management and employees and
the nominees described above may be deemed to be participants in
the solicitation of proxies in respect of the proposed transaction,
including with respect to Qualcomm's 2018 annual meeting of
stockholders. You can find information about Broadcom's
executive officers and directors in Broadcom's definitive proxy
statement filed with the SEC on February
17, 2017. Information about the Broadcom nominees is
included in the preliminary proxy statement that Broadcom has filed
with the SEC and will be included in the definitive proxy statement
that Broadcom intends to file with the SEC. Additional
information regarding the interests of such potential participants
is included or will be included in one or more registration
statements, proxy statements, tender offer statements or other
documents filed or to be filed with the SEC if and when they become
available. These documents (if and when available) may be
obtained free of charge from the SEC's website
http://www.sec.gov.
Investors:
Ashish Saran
Broadcom Limited
Investor Relations
408-433-8000
investor.relations@broadcom.com
Or
Tom Germinario / Rick Grubaugh
D.F. King & Co., Inc.
212-269-5550
Media:
Joele Frank / Steve Frankel / Andi Rose
Joele Frank, Wilkinson Brimmer
Katcher
212-355-4449
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SOURCE Broadcom Limited