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Technology Stocks : The New QUALCOMM - Coming Into Buy Range
QCOM 180.90+2.1%Oct 31 9:30 AM EDT
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To: Lance Bredvold who wrote (9073)7/28/2023 11:59:59 PM
From: Elroy  Read Replies (1) of 9129
 
MXL agreed to buy SIMO at the very peak of the semi cycle.

And mostly cash.

Great sale for SIMO, awful purchase for MXL.

But.....I'm not sure how MXL gets out of the agreement unless they have some mysterious violation by SIMO. I wonder if MXL (which has to come up with $3 billion cash to do the deal as written) has lost their Wells Fargo "committed financing" by trying to cancel the deal, and then if MXL loses in arbitration, where's the $3 billion going to come from? I doubt any bank will lend that amount to the combined twosome today at any decent rate.

So.....if MXL loses in arbitration perhaps they go bankrupt because they can't meet this $3 billion obligation to SIMO.

MXL has ~$250m cash and $100m debt.

But MXL's equity is $1.8 billion today, so I'm missing something.
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