Qualcomm ex-CEO, Paul Jacobs to leave board as he explores taking company private
17 Mar 2018
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Qualcomm Inc former director Paul Jacobs, son of the chipmaker’s founder and a former chief executive officer, is exploring an acquisition of the company and will leave the board according to the company.
“The board reached that decision following his notification to the board that he has decided to explore the possibility of making a proposal to acquire Qualcomm,” the company said in a statement yesterday.
Jacobs, 55, lost his executive chairman's title last week as the company sought to fight off Broadcom Ltd’s $117-billion hostile takeover bid. But the board largely agreed with Jacobs that Broadcom’s bid was too low.
However, according to early counts in a board vote tied to the Broadcom bid many Qualcomm shareholders had voted to replace Qualcomm directors, including Jacobs and chief executive officer Steve Mollenkopf. The deal was blocked by US president Donald Trump earlier this week.
Qualcomm said yesterday that it would continue to focus on executing the company’s current business plan as an independent entity. “There can be no assurance that Dr. Jacobs can or will make a proposal, but, if he does, the Board will of course evaluate it consistent with its fiduciary duties to shareholders,” Qualcomm added in the statement.
Jacobs owns less than 0.5 per cent of Qualcomm, according to Bloomberg data. According to commentators, for an individual, it would be challenging to raise the kind of money needed to complete a leveraged buyout of over $100 billion, especially if funding sources are restricted to the US due to regulatory scrutiny on overseas chip deals.
But they also point out that the example of founder Michael Dell who used a buyout to keep control of his company. In 2013, Dell took the computer maker private in a $24.9-billion deal but is now considering taking the company public again.
