NXP Semiconductors explores sale to Qualcomm: sources

Thu Sep 29, 2016 7:22pm EDT
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By Greg Roumeliotis and Liana B. Baker

(Reuters) - NXP Semiconductors NV (NXPI.O: Quote) is exploring selling itself to Qualcomm Inc (QCOM.O: Quote) in a deal that could be valued at more than $30 billion, two sources familiar with the matter said on Thursday.

The deal would help diversify Qualcomm's business and make it a bigger supplier to the automotive industry. Talks are in the early stages and NXP may entertain other offers, should they emerge, according to one of the sources.

An agreement with Qualcomm could be struck in the next two to three months, according to the Wall Street Journal, which first reported news of the talks.

Representatives for Netherlands-based NXP and San Diego-based Qualcomm declined to comment.

NXP shares rose 16.9 percent to close at $96.12 on Thursday, while Qualcomm's rose 6.3 percent to $67.45.

NXP closed a nearly $12 billion deal to buy U.S.-based Freescale Semiconductor last December, creating the world's top maker of automotive electronics and doubling the percentage of its auto-related revenue to 40 percent. It could also attract interest from other large semiconductor companies such as Broadcom and Texas Instruments Inc (TXN.O: Quote), analysts have said.

Qualcomm, which supplies Android smartphone makers and Apple Inc (AAPL.O: Quote), has been dealing with slowing smartphone sales and stiff competition from Chinese and Taiwanese rivals.

Qualcomm has so far sat out the transformative consolidation sweeping the industry, which has seen mega-deals such as Avago (AVGO.O: Quote) buying Broadcom for $37 billion last year.   Continued...

A Qualcomm company bus used to transport employees among its many buildings is shown in San Diego, California  November 3, 2015.    REUTERS/Mike Blake