On the morning of June 4th, according to Taiwan’s “Economic Dailyâ€, Broadcom (35.88, 1.04, 2.99%), the world’s second largest IC design company, will sell mobile phone chip business. There are market rumors that MediaTek may take over to strengthen 4G LTE. Technology, and to undertake the original customers of Broadcom, the trend into the global mobile phone leader Samsung supply chain.
Xie Qingjiang, general manager of MediaTek, has revealed that he will continue to conduct mergers and acquisitions. If there is a good investment or M&A opportunity, it will be one of the options, but he did not comment on whether MediaTek will acquire Broadcom's mobile phone chip business yesterday.
The legal person believes that if the relevant rumors come true, it will be a major milestone for MediaTek to grab the brand customers, which will help the company to move toward the global IC design industry to “sit in the second place†and draw closer to its rival Qualcomm (80.4, -0.08, -0.10%) gap.
Broadcom is the global chip industry leader, and the market share of mobile phone chips ranks fifth, after Qualcomm, MediaTek, Spreadtrum, and Intel (27.66, 0.40, 1.47%). In the face of Qualcomm and MediaTek's two oligopolies occupying the market, Broadcom's mobile phone chip business is developing hard. Recently, it has been reported that Broadcom intends to sell or gradually abandon the business.
Forward Concepts (FC) analyst Will Strauss said in an overseas interview that Broadcom has been unable to win any product design and application in the United States, and is facing fierce competition from overseas (outside the US). The only bright spot in the FM business may be the acquisition target of MediaTek or even a private equity fund.
According to industry analysis, after the acquisition of LTE-related assets of Renesas subsidiary Renesas Mobile in 2013, Broadcom has already grabbed Samsung's target customers. If MediaTek undertakes Broadcom's mobile phone chip business, it is expected to enter the Samsung supply chain.
At present, MediaTek mobile phone chips are still mainly sold to mainland China, such as Lenovo, Huawei, Alcatel, and Taiwan HTC. If they can enter the Samsung supply chain, it will be a milestone for MediaTek's brand customers.
MediaTek’s current revenue gap with Broadcom is less than $300 million. If MediaTek bought Broadcom's mobile phone chip business, it is getting closer and closer to the global IC design industry, and the gap with the leading Qualcomm continues to narrow.
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