Broadcom really, really wants to hook up with Qualcomm.
The San Jose, California, company, which makes chips for everything from cable modems to set-top boxes and digital video recorders, on Monday launched an unsolicited bid for Qualcomm, the world’s largest maker of chips and processors for phones, for $70 a share, or a $130 billion.
Qualcomm shares rose 3.5 percent to $64 in premarket trading. Broadcom rose 1.6 percent to $278.05.
A combination of the two would create a chip giant supplying components to a wide array of electronic gadgets found in your home or pocket. The deal marks a surprising turnaround from nearly a decade ago, when the two companies were bitter rivals in the courtroom. At the time, both companies made cellular chips, and Qualcomm ultimately had to pay Broadcom $891 million to settle the dispute.
Broadcom eventually sold its cellular business, and is looking to get back into the game in a big way with Qualcomm. The San Diego company makes processors that power nearly every flagship phone in the world, and supplies the cellular radio to some iPhones.
The deal, Broadcom says, would make the combined company the leading diversified communications chip company and would create a larger scale would drive research and development into next-generation technology.
Qualcomm said in a statement that it has received the proposal and will assess the terms. It declined to comment further.