Qualcomm Merger Calculus Complicated by Activist Investor<br />Elliott Management, a $34 billion hedge fund that owns about 6 percent of NXP, argued on Monday<br />that NXP was worth $135 a share on its own — far more than the $110 a share that Qualcomm has offered for the company.<br />“While NXP’s operating performance has fully bounced back over the past year, its stock price has not — again, likely due to,<br />in our view, the ceiling created by Qualcomm’s low priced offer,” Elliott wrote in a letter to its fellow shareholders<br />The hedge fund argued that Qualcomm’s takeover bid effectively serves as a cap on how high<br />NXP’s shares can go, though $135 a share is far higher than the stock’s historic high.<br />Elliott argued in a presentation that the market has not fully appreciated how much of a revival NXP’s business has enjoyed,<br />particularly after the company fully processed its acquisition of another chip maker, Freescale Semiconductor.<br />By extension, Elliott argued, the proposed takeover — valued at $38.5 billion when it was announced — should be re-priced significantly higher.<br />Now the fate of the NXP transaction — which Qualcomm has argued was all but a done deal — has been somewhat clouded.
