Atheros Surges on Speculation of Qualcomm Bid

Includes: ATHR, QCOM
by: Proactive Investor

Shares in Atheros Communications (NASDAQ:ATHR) spiked higher Tuesday afternoon after the New York Times claimed that the company was close to announcing that it would be acquired by Qualcomm (NASDAQ:QCOM).

Atheros rose as much as 30%, and are currently trading around 18% higher $44.00 per share, just below speculation from the New York Times of a $45 per share bid.

Qualcomm on the other hand, initially spiked lower, but quickly rebounded and is currently trading around 1% higher at $50.63.

The New York Times, citing unnamed sources, said the deal could be announced as soon as Wednesday.

Though not an insignificant acquisition, any transaction for Atheros would be well within Qualcomm’s financial abilities. The company has a market capitalization of almost $82 billion at today’s share price, compared to the implied takeover price for Atheros of $3.5 billion.

Qualcomm designs, manufactures and markets digital wireless telecommunications products and services based on its code division multiple access technology and other technologies.

Atheros Communications provides technologies for wireless and wired communications products that are used by a range of customers, including manufacturers of personal computers, networking equipment, enterprise and carrier deployments, and consumer electronics for home and mobile applications.