Qualcomm Joins Autonomous Driving Technology Acquisition Battle with 900 Billion Won Premium

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Suhwan] Qualcomm, the world's largest semiconductor chip design company for smartphones, has entered the bidding for an autonomous driving technology company.

Major foreign media reported on the 5th (local time) that Qualcomm plans to invest $4.6 billion (5.25 trillion KRW) in the acquisition bid for 'Veoneer,' a Swedish automotive parts company that develops autonomous driving software.

Previously, Canadian automotive parts company 'Magna International' had offered $3.8 billion (4.34 trillion KRW) to acquire Veoneer, and the two companies had already agreed on contract terms.

However, Qualcomm entered the bidding by offering a premium of $800 million (910 billion KRW) over Magna's price.

Qualcomm proposed to acquire Veoneer's shares at $37 per share, which is an 18% premium over Magna's offer of $31.25 per share.

Veoneer stated, "The board of directors has decided to evaluate Qualcomm's proposal."

If Veoneer accepts Qualcomm's acquisition terms and cancels the agreement with Magna, it must pay Magna $110 million (127.5 billion KRW).

However, since Qualcomm's offer far exceeds the contract termination fee, it is interpreted that Veoneer has accepted Qualcomm's bid proposal.

Bloomberg reported that if Qualcomm acquires Veoneer, it will "establish a strong position in the emerging market of driver assistance technology."

Qualcomm is widely known as a smartphone chip supplier, but it has also been supplying automotive chips for 10 years and developed an advanced driver assistance system (ADAS) chip called 'Snapdragon Ride' last year.

Earlier this year, Qualcomm signed a business agreement with Veoneer to develop software and chip platforms to be installed in Veoneer's driver assistance system 'Arriver.'

Dan Levy, an analyst at global investment bank Credit Suisse, pointed out that when Magna initially pursued the acquisition of Veoneer, Magna investors thought the acquisition price was too high, and said, "It does not seem that Magna will offer a higher price than Qualcomm."

Veoneer's stock price closed at $40.15, up 28.48%, on the New York Stock Exchange on the day news of Qualcomm's bid participation was announced.

This content was produced with the assistance of AI translation services.