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Qualcomm tops Magna’s bid with $4.6 billion offer for Veoneer

(Reuters) -Chipmaker Qualcomm Inc said on Thursday it had offered to buy Swedish auto parts maker Veoneer Inc for $4.6 billion, an 18.4% premium to a bid by Canada’s Magna International Inc that was accepted by Veoneer’s board.

U.S.-listed shares of Veoneer rose 21.7% in premarket trading as the stage was set for a bidding war. Neither Magna or Veoneer made any immediate comment.

Demand has been on the rise for advanced driver assistance systems, known in the industry as ADAS, that add features ranging from collision warning to parking assist. Some systems collect data from cameras and radar to monitor surroundings, interpret the situation and take action.

Qualcomm, apart from powering mobile phones, has been a chip supplier to carmakers for a decade and last year started its own line of ADAS systems called Snapdragon Ride.

Earlier this year it signed a signed a collaboration deal with Veoneer to develop a software and chip platform for driver-assistance systems.

While fully self-driving vehicles are years away, assisted-driving features, such as adaptive cruise control, are being fitted into new cars by most manufacturers.

Qualcomm hopes to grow its automotive chips business by creating open and competitive platforms for automakers along with Veoneer.

“As the automotive industry continues to transform, it is becoming increasingly important for automakers to have a partner who develops horizontal platforms that drive innovation and enable competition,” said Qualcomm CEO Cristiano Amon.

Magna has a similar interest in buying Veoneer as it tries to compete with ADAS makers such as Aptiv, Bosch and Continental to capture a larger share of the booming business.

The Canadian company had offered to buy rival Veoneer in July for about $3.8 billion in cash.

(Reporting by Chavi Mehta in Bengaluru and Supantha Mukherjee in Stockholm; Editing by Krishna Chandra Eluri, Vinay Dwivedi, Elaine Hardcastle)

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