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Broadcom play for Qualcomm would create a new Big Three

Consolidation is the name of the game in semiconductors right now, particularly with Broadcom weighing a hostile takeover bid for Qualcomm.

Why it matters: If Broadcom buys Qualcomm — combined with Qualcomm's pending purchase of Dutch rival NXP — it would expand the chip-making market's Big Two into its Big Three:

Data: Gartner, Jan. 2017; Chart: Andrew Witherspoon / Axios

Qualcomm recently rejected an unsolicited $103 billion takeover offer from Broadcom, but all indications are that Broadcom will go hostile by nominating a slate of Qualcomm board directors by a Dec. 8 deadline. The effort would continue to be backed by longtime Broadcom investor Silver Lake, which has committed up to $5 billion in financing.

  • Private equity angle: Silver Lake does not have any hostile takeover restrictions in its limited partnership agreements, as do some other private equity firms. It did, however, object to The Blackstone Group's consideration of a hostile bid for Dell Inc. several years back, which would have rivaled Silver Lake's own deal for the company in partnership with Michael Dell. As for its rhetorical about-face, the (tenuous) argument here would be that Silver Lake is backing an existing management team (Broadcom) rather than being a purely hostile actor (no, Qualcomm wouldn't see it quite so generously).

Broadcom also last week finalized its purchase of network equipment maker Brocade, while smaller chip-maker Marvell Technology Group said that it would pay $6 billion to buy Cavium.

Mike Allen 2 hours ago
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How Trump created a new era of high risk

Illustration: Lazaro Gamio / Axios

On Jan. 26, just over a year into his presidency, President Trump had a president's dream: peace and prosperity. The Dow Jones industrial average, S&P 500 and Nasdaq all hit record highs.

Where it stands: Since then, Trump has injected multiple new risks into the system.

Kim Hart 5 hours ago
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Tech's terrible week

A sad computer
Illustration: Lazaro Gamio/Axios

From a fatal car crash to a data nightmare, turning-point scenarios played out in several corners of the technology industry this week.

Why it matters: The utopian promise of technological progress is giving way to the very thorny challenges of balancing innovation with social accountability. That means congressional hearings, investigations, probably at least some regulation — and a lot more skepticism about the promise of the tech-driven changes that are transforming our lives.