The San Diego-based chipmaker announced on Monday that it was passing on the acquisition, which Broadcom actually valued at $130 billion taking Qualcomm's $25 billion debt into account.
Qualcomm also warned that such a merger would face significant regulatory hurdles. (It could also make both moves, of course, targeting shareholders with better terms than the first proposal held.) Or, as Barron's pointed out, Broadcom could make more hostile moves, such as trying to nominate allies to Qualcomm's board.
"It is the Board's unanimous belief that Broadcom's proposal significantly undervalues Qualcomm relative to the company's leadership position in mobile technology and our future growth prospects", said Paul Jacobs, executive chairman of Qualcomm.
Broadcom CEO Hock Tan, who said earlier this month he would redomicile his company to the United States from Singapore, has stated he is open to launching a takeover battle.
Broadcom said Monday that it remains committed to pursuing a deal.
Qualcomm's board of directors has rejected Broadcom's $105 billion takeover bid, saying the offer "significantly undervalues" the company. "We continue to believe our proposal represents the most attractive, value-enhancing alternative available to Qualcomm stockholders".
The deal would dwarf Dell Inc's US$67 billion acquisition of EMC in 2015 - then the biggest in the technology industry. If it does sell to Broadcom, it means the combined businesses' chips will be present in more than a billion smartphones sold every year.
"We have received positive feedback from key customers about this combination", he said in a statement following Qualcomm's rejection. Sources close to the deal say that Broadcom is preparing to challenge Qualcomm's sitting board members with its own hand-picked slate at the next stockholder's vote.
However, Qualcomm is likely to dig in for a lengthy siege. Many have expressed to us their desire that Qualcomm meet with us to discuss our proposal.
Tan said his offer for Qualcomm stands with or without Qualcomm's acquisition of NXP.
And CEO Steve Mollenkopf said that Qualcomm well positioned for continual growth. "We are highly confident that the strategy Steve and his team are executing on provides far superior value to Qualcomm shareholders than the proposed offer".