Taipei, MediaTek Inc., Taiwan's largest integrated circuit designer, denied reports on Wednesday that it has been in talks with Singapore-headquartered counterpart Broadcom Ltd. on a possible takeover.
In a statement filed with the Taiwan Stock Exchange, MediaTek said the company has never contacted or entered into any talks with Broadcom on the possibility of it being acquired by the Singapore company.
On Monday, the U.S.-based business website Motley Fool reported that Broadcom has listed MediaTek as one of three acquisition targets after U.S. President Donald Trump rejected its plan to acquire Qualcomm Inc.
The two other targets were U.S.-based companies Cirrus Logic Inc. and Xilinx Inc., the report said.
The Motley Fool report was widely cited by local media, with the Economic Daily News even putting the news on its front page on Wednesday.
Local media later reported that MediaTek Chairman Tsai Ming-kai (???) met recently with Broadcom Chief Executive Officer Hock Tan to discuss a possible acquisition.
The Motley Fool has identified Intel, which lost the mobile market to Qualcomm, as a potential buyer of MediaTek.
But "MediaTek would also be a great fit for Broadcom, since Broadcom already supplies plenty of other components -- like power amplifiers and touch screen controllers -- for smartphones," the Motley Fool said.
Smartphone chips are MediaTek's largest source of revenue, with leading smartphone brands such as Samsung, Xiaomi, Sony, and Lenovo among its major clients.
The Motley Fool report said MediaTek is well within Broadcom's means. Its market capitalization is only about US$17 billion, much lower than the US$117 billion Broadcom was ready to pay for Qualcomm, according to the report.
On Wednesday, shares of MediaTek fell 1.90 percent to close at NT$336.00 on the Taiwan stock exchange.
Source: Focus Taiwan News Channel