MediaTek Inc (聯發科) shares yesterday shed as much as 2.19 percent amid speculation that the nation’s largest handset chip designer is Broadcom Ltd’s new buyout target.
The speculation came after Broadcom’s US$117 billion hostile takeover bid for US chipmaker Qualcomm Inc was thwarted last week by US President Donald Trump because of concern over national security.
After the Broadcom-Qualcomm debacle, the Singapore-based chip company has set its sights on Qualcomm’s nearest rivals — MediaTek, Xilinx Inc and Cirrus Logic Inc — as potential targets, the Chinese-language Economic Daily News reported yesterday.
By acquiring MediaTek, Broadcom would broaden its exposure to Apple Inc’s supply chain and enhance its 5G technological capability, the newspaper said, citing a report by the US-based The Motley Fool.
MediaTek was reportedly cracking into Apple’s supply chain by supplying modems for next-generation iPhones and iPads. Broadcom is a modem supplier to Apple.
The Hsinchu-based company also supplies smartphone chips to other leading brands, such as Samsung Electronics Co, Sony Corp, Lenovo Group Ltd (聯想) and Xiaomi Corp (小米).
Qualcomm controlled 42 percent of the world’s smartphone system-on-chip market in the third quarter of last year, while MediaTek had a 14 percent share, The Motley Fool reported, citing data compiled by Counterpoint Technology Market Research.
The Economic Daily News also said that MediaTek chairman Tsai Ming-kai (蔡明介) flew to Singapore last week to meet Broadcom chief executive officer Hock Tan (陳福陽), prompting further speculation that a deal could be under way.
MediaTek denied the report, saying that Tsai did not go to Singapore last week.
“It is entirely media speculation. MediaTek did not approach Broadcom to discussion the matter mentioned in the report,” MediaTek chief financial officer and spokesman David Ku (顧大為) said in a filing with the Taiwan Stock Exchange.
MediaTek shares yesterday ended 1.9 percent lower at NT$336 in Taipei trading, bringing the company’s market value to NT$531.22 billion (US$18.2 billion).
That would make it far cheaper for Broadcom to take over MediaTek than Qualcomm, for which it bid US$117 billion.
“It never came cross anybody’s mind that MediaTek would become Broadcom’s acquisition target,” a semiconductor analyst said on the telephone, requesting anonymity.
However, “anything can happen” in the rapidly changing global chip industry, the analyst added.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by