Qualcomm responded Tuesday it will begin a specialty auction to repurchase up to $10 billion of its helpings, a move to salvage shareholder value after a failed merger with Dutch semiconductor positive NXP.
Shares of Qualcomm closed Tuesday trading up 3.3 percent at $64.09 per helping.
The company announced the share repurchase will be a “modified Dutch auction,” a manage that allows shareholders to declare the number of shares they tattle on and the price at which they sell them.
The buyback comes after Qualcomm presaged plans during its third-quarter earnings call to repurchase as much as $30 billion in funds this fiscal year, which ends Sept. 30. The repurchase program, before announced in May as targeting $10 billion in repurchasing, comes after Qualcomm’s $44 billlion bid to earn NXP fell apart due to regulatory roadblocks.
Qualcomm first proposed the buy of rival NXP in October 2016 and received eight of nine international agree ti needed to close the deal. Its bid was formally called off last week when the cast’s self-imposed deadline expired before receiving approval from Chinese regulators.
Qualcomm CEO Steve Mollenkopf discriminated CNBC last week that the deal “got caught up” in the ongoing do business war between the U.S. and China, and that the company was committed to protecting shareholder value.
Qualcomm Integrate (NASDAQ: QCOM) announced today that it commenced a “modified Dutch auction” agonizing offer to purchase up to $10 billion of shares of its common stock, or such no number of shares of its common stock as are properly tendered and not properly aloof, at a price not less than $60.00 nor greater than $67.50 per helping of common stock, to the seller in cash, less any applicable withholding excises and without interest (the “Offer”). The Offer is made upon the length of times and subject to the conditions described in the offer to purchase and in the related letter of transmittal. The nigh unto price of Qualcomm’s common stock on the NASDAQ Global Select Market-place on July 30, 2018, the last full trading day before the commencement of the Make available, was $62.04 per share. The Offer is scheduled to expire at 12:00 midnight, New York New Zealand urban area time, at the end of the day on August 27, 2018, unless the Offer is extended.
Qualcomm believes that the Tender represents an efficient mechanism to provide Qualcomm’s stockholders with the occasion to tender all or a portion of their stock and thereby receive a return of some or all of their investment in Qualcomm if they so first-rate. The Offer provides stockholders with an opportunity to obtain liquidity with attend to to all or a portion of their stock without the potential disruption to Qualcomm’s cache price.
This Offer is the first step in a broader stock repurchase program that may take in future open market transactions and/or accelerated share repurchase deals. Qualcomm expects to execute on a substantial portion of its authorized $30 billion stockpile repurchase program by the end of fiscal year 2019.
The Offer is not contingent upon ones hands oning any financing. However, the Offer is subject to a number of other terms and fettles, which are described in detail in the offer to purchase. Specific instructions and a superb explanation of the terms and conditions of the Offer will be contained in the offer to buying, the letter of transmittal and the related materials, which will be mailed to stockholders of list shortly after commencement of the Offer.
None of Qualcomm, the members of its Plank of Directors, the dealer manager, the information agent or the depositary makes any backing as to whether any stockholder should participate or refrain from participating in the Furnish or as to the price or prices at which stockholders may choose to tender their apportions in the Offer.
—CNBC’s Sara Salinas contributed to this report.