The saga kicked off almost a year ago, in January 2017, when Apple first filed a lawsuit against Qualcomm for allegedly abusing its market position to extract more money from hardware manufacturers.
According to Bloomberg, Broadcom is now in talks with advisers on how to best approach the potential bid, which is likely to be made official in the next few days. At $70 a share, an offer would value Qualcomm at $103 billion.
Broadcom was created past year when Tan's Avago Technologies Ltd. bought Irvine-based chipmaker Broadcom Corp. for $37 billion and then adopted the Broadcom name for the combined company.
Broadcom keeps a presence in Irvine and a US headquarters in San Jose.
Qualcomm finds itself in a weakened state. Qualcomm's shares shot up almost 13 percent in midday trading today after the report, for a valuation of about $92 billion. Even though Qualcomm's component is considered to be the best, Apple is trying to get back at the company for various patent and legal issues. Since then, though, smartphone sales growth has slowed and Intel has succeeded in placing its modems in some iPhone models.
It is also possible that Broadcom wishes to purchase Qualcomm so that the legal battle with Apple draws to a close and because the chipset manufacturer could eventually become an industry arm of Apple's supplier. Apple contends Qualcomm is unfairly charging too much and illegally taking advantage of its market position in chips.
Qualcomm, based in San Diego, is also confronting headwinds in closing its $47 billion purchase of NXP Semiconductors. It has faced regulatory scrutiny in Europe, and some shareholders such as activist hedge fund Elliott Management Corp. have said the deal undervalues NXP, a large maker of automotive and other chips.
The two companies are already involved in big deals from about a year ago.