AVGO shares were 0.3% lower Monday while QCOM was 1.9% higher after a huge jump Friday.
The initial optimism over the deal may have waned as some argued Qualcomm may reject the $70-per-share cash and stock deal on grounds that it’s opportunistic and posses regulatory risks, Bloomberg reports. Qualcomm company stocks have weakened in the past year over its legal fight with Apple (NasdaqGS: AAPL), which has led to some calling this a low opportunistic grab by Broadcom.
Nevertheless, Qualcomm would still add something to Broadcom’s portfolio.
“Net net, Broadcom needs LTE and 5G capability that they don’t have today,” Patrick Moorhead, analyst at Moor Insights & Strategy, told the Financial Times. “That’s what this comes down to. What comes with it, though, is a ton of complexity. There is a lot of overlap in WiFi and Bluetooth, which could absolutely raise the ire of the regulators.”
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