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U.S.- and Singapore-based semiconductor firm Broadcom Ltd. doesn’t like taking no for an answer. The company, which recently saw an offer to acquire rival chipmaker Qualcomm Technologies Inc. rejected, Monday said it has made a new offer of $121 billion.

Reuters Sunday cited unnamed sources who say the new bid is designed to force Qualcomm to enter into negotiations. The bid comes ahead of the latter firm’s annual shareholder meeting on March 6, where Broadcom is attempting to oust Qualcomm’s board and replace directors with its own nominees. Qualcomm said it’s reviewing the offer.

The new offer is up from the Broadcom’s original offer of $70 per share, which consisted of $60 per share in cash and $10 per share in stock. To sweeten the deal further, Broadcom is also offering a higher breakup fee in case regulators block the deal. Generally, breakup fees amount to around 3 to 4 percent of a deal’s value.

Qualcomm’s shares fell almost 7 percent in trading Monday, however. Two brokerage firms said Apple Inc. could drop the chipmaker’s modem chips for others made by Intel Corp. for its next iPhone. Also, later in the trading day, the Nasdaq exchange fell close to 4 percent in the broadest market sell-off in more than seven years.

Reuters reported that Broadcom is “very confident” that any deal would be completed within 12 months of an agreement being signed. However, Qualcomm’s board is still said to be resisting the deal, arguing that Broadcom’s offer is designed to acquire the company “on the cheap.” It also claims that the regulatory review processes required to complete the acquisition would be fraught with risk and take a minimum of 18 months.

“It’s clear they [Broadcom] really want Qualcomm,” said Holger Mueller, principal analyst and vice president of Constellation Research Inc. “They’ve given Qualcomm shareholders something to ponder before the shareholder meeting early in March. It now comes black for both Qualcomm and Broadcom to explain their longer term business plans so investors can decide which bet to take.”

Patrick Moorhead, principal analyst at Moor Insights and Strategies, said the improved offer was made after Qualcomm upped its guidance for the current financial year due to its recent successes in the “internet of things,” Wi-Fi and automotive sectors. But although the offer might seem tempting on paper, Moorhead said he doesn’t believe Broadcom will be able to convince Qualcomm’s shareholders to accept it.

“At any price, this is a strategic mismatch as Qualcomm creates intellectual property and Broadcom implements it, therefore investment horizons are different,” Moorhead said. “Savvy Qualcomm investors know this is a bad offer and I’m not expecting the deal to go through.”

Broadcom’s hostile takeover attempt is one of the most ambitious moves to date in a period when consolidation is gripping the semiconductor industry. Most recently, Microsemi Corp., which sells computer chips to the military and aerospace industries, was reported to be seeking buyers after receiving a takeover offer from an unnamed firm.

Broadcom itself also recently completed a $5.5 billion acquisition of rival firm Brocade Communications Systems Inc., while Qualcomm is still trying to clinch its own $38 billion deal to buy the Dutch semiconductor firm NXP Semiconductors NV. That deal was approved by European Union regulators in January, and Qualcomm has said it expects Chinese government approval to be confirmed this month.

Image: Broadcom