Morning Commentary: NXP Semiconductors convertibles jump after buyout offer increases

By Abigail W. Adams

Portland, Me., Feb. 20 – NXP Semiconductors NV’s 1% convertible notes due 2019 were active Tuesday morning, jumping about 4 points on an outright basis to trade around 129.

NXP Semiconductors stock was also the most actively traded on the Nasdaq and jumped to $125.61, an increase of 6.01%, early in Tuesday’s session.

Qualcomm Inc. announced Tuesday that it was upping its offer for NXP Semiconductors to $127.50 a share, or $44 billion, from the previous offer of $110 per share. Qualcomm also reduced the minimum tender conditions to 70% of NXP shares from 80%.

The revised offer for NXP has won approval from activist investor Elliott Management and shareholder Soroban Capital Partners LP. Regulatory approval from China and approval from 42% of NXP shares are the last hurdles in Qualcomm closing the long-delayed acquisition.

As Qualcomm attempts to close its acquisition of NXP, Broadcom’s hostile takeover attempt of Qualcomm continues with a showdown expected at Qualcomm’s 2018 shareholder meeting on March 6.

Broadcom issued a statement Tuesday morning slamming Qualcomm’s board of directors for raising its offer for NXP Semiconductors and stated it would be evaluating its options.

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