(Bloomberg) -- Veoneer Inc. said it will engage in takeover discussions with Qualcomm Inc., whose $4.6 billion bid for the Swedish driver-assistance technology company is likely to be “superior” to an earlier offer from Magna International.
At $37 a share, Qualcomm is offering an 18% premium to Magna’s $31.25-a-share bid. Stockholm-based Veoneer and Magna said last month their boards had unanimously approved what would have been a $3.8 billion deal.
Veoneer, in a statement Sunday, said its merger agreement with Magna remains in full force for now and that it’s following terms that allow it to engage with higher bidders. Veoneer’s board determined that the Qualcomm overture “would reasonably be expected to result in a ‘Superior Proposal,’ as defined under terms of Veoneer’s merger agreement with Magna,” the company said in the statement.
With Veoneer, San Diego-based Qualcomm would get firmer footing in the emerging market for driver-assistance technology. Crash-avoidance and hands-free driving have become a hotly contested battleground as automakers seek to boost prices and best rivals.
Global auto suppliers and chipmakers are increasingly positioning for growth in advanced safety features. Qualcomm has been trying to expand its reach beyond smartphones.
Veoneer shares closed at $38.69 in New York on Aug. 6 and have risen 82% this year.
©2021 Bloomberg L.P.