Qualcomm rejects $103B takeover bid by Broadcom

Mobile chipmaker Qualcomm Inc. on Monday rejected rival Broadcom Ltd.’s $103 billion takeover bid, saying the offer undervalued the company and would face regulatory hurdles.

Broadcom said it would seek to engage with Qualcomm’s board and management, adding that it had received positive feedback from key customers and stockholders.

Both companies count Apple among their top customers. Analysts have said a deal between the two would help Qualcomm settle its legal battle with the iphone maker, as Broadcom has a closer relationship with Apple.

Broadcom made an unsolicited bid last week to buy Qualcomm in an effort to become the dominant supplier of chips used in the 1.5 billion or so smartphones expected to be sold around the world this year.

Analysts said Broadcom can now raise its bid, go for a proxy fight or launch a hostile exchange offer.