Intel plans to buy Broadcom to counter possible deal with Qualcomm

Intel plans to buy Broadcom to counter possible deal with Qualcomm

For several weeks, the semiconductor sector has been agitated by the attempted takeover of Qualcomm by Broadcom. A merger would in principle constitute a new giant in the sector capable of shifting market equilibria.

Intel-logoBut because their areas of activity largely overlap, there is a good chance that the project will not be validated by regulators, unless imposing substantial remedies.

In addition, Qualcomm, which is already involved for its part in the acquisition of NXP Semiconductors, estimates that Braodcom's offer ($ 117 billion) is insufficient in view of future potentials such as 5G or the connected / autonomous automobile.

Even so, if the deal was made, it wouldn't do the business of another semiconductor player: Intel. According to Wall street journal, the latter would study the possibility of triggering a buyout offer on Broadcom in the event that the deal between Broadcom and Qualcomm takes a more serious turn.

This possibility, which would only be at the evaluation stage, would not be less problematic from the point of view of the regulators and would again require making a very substantial offer, Broadcom being valued at 104 billion dollars.

However, it would allow Intel to reposition itself in the mobile components segment, in particular at the edge of 5G and the rise of IoT, and to offer cross offers with its own products.

However, this is only one of the tracks considered and the Santa Clara group could just as easily turn to acquisitions of smaller targets that are less problematic from a regulatory point of view.