New York: Chipmaker Broadcom Ltd is considering raising its offer to buy rival Qualcomm Inc. by offering more of its own stock, following consultation with several of Qualcomm’s top shareholders, according to people familiar with the matter.

While the timing of the new offer is uncertain, Broadcom’s bid preparations indicate that it is planning to apply pressure on Qualcomm to engage in negotiations by offering more to its shareholders, in addition to threatening to replace its board of directors.

Broadcom’s chief executive Hock Tan has stated he is open to launching a takeover battle and people in the know had previously said the company is preparing to submit a slate of directors by Qualcomm’s 8 December nomination deadline. Qualcomm shareholders that want the company to engage in deal talks with Broadcom will be able to vote for that slate at a 6 March shareholder meeting.

Broadcom has offered to pay $103 billion for Qualcomm, made up of $60 per share in cash and $10 per share of its own stock. Raising the offer by adding more of its shares would avoid Broadcom having to raise more debt and further pressure its credit rating, the people said.

Qualcomm’s shareholders have indicated to Broadcom they expect at least $80 per share in order for Qualcomm to be sold, the people said. Broadcom’s board has not yet decided on the level of any new offer, the people added.

Broadcom has made several requests for a meeting with Qualcomm since it unveiled its offer on 6 November, the people said. However, Qualcomm has so far rejected these meeting requests, they added. Broadcom had not approached Qualcomm in the weeks prior to announcing its offer, according to the people.

The people asked not to be identified because the deliberations are confidential. Qualcomm and Broadcom declined to comment.

Qualcomm shares jumped after the news of the possible sweetened offer and were up more than 2% at $68.05 in late afternoon trading. Broadcom shares were down 0.3% at $275.82.

Qualcomm invented a number of technologies underlying mobile communications and also sells chips used in cellphones and other devices. It is engaged in a patent infringement dispute with Apple Inc, and is also trying to close its $38 billion acquisition of automotive chipmaker NXP Semiconductors NV after signing a deal in October 2016. Broadcom has indicated it is willing to acquire Qualcomm irrespective of whether it closes the NXP deal.

NXP shares have been trading above Qualcomm’s offer price, as many NXP shareholders, including hedge fund Elliott Management Corp, have been holding out for a better price. Qualcomm does not need to decide to raise its offer for NXP until that deal receives antitrust clearance from all the regulators reviewing the deal around the world. Reuters