Qualcomm said former executive chairman Paul Jacobs will be leaving from the board of directors of the semiconductor company.
Paul Jacobs in a statement said he will try to buy Qualcomm. Paul Jacobs is the son of Irwin Jacobs, the co-founder of Qualcomm. It is not clear whether Qualcomm board has removed Paul Jacobs from the board.
Paul Jacobs, who worked with Qualcomm since 1990, was the former chief executive officer of the US-based wireless chipset-making company, has earlier tried to block a $117 billion takeover bid from rival Broadcom.
Singapore-based Broadcom had to pull out of the hostile takeover as the U.S. president Donald Trump blocked the deal due to security reasons. It is now clear that Paul Jacobs has lost the support of fellow board of directors including CEO Steve Mollenkopf. Leaving the director position was the only option for the son of the Qualcomm co-founder.
Qualcomm has a market capitalization of around $90 billion. Paul Jacobs holds about 1.3 million shares of Qualcomm, less than 0.1 percent of outstanding shares, according to Qualcomm’s security filings.
Paul Jacobs said in a statement that it was unfortunate and disappointing that his fellow board members were “attempting to remove me from the board at this time.”
Paul Jacobs, according to Reuters reports, has clashed with other members of the San Diego-based company’s board, including Chief Executive Steve Mollenkopf, over how Qualcomm defended itself.
Qualcomm in a statement said that its board of directors met on Friday and decided that Paul Jacobs would not be nominated for re-election at its annual meeting on March 23, and that the board would shrink to 10 members from 11.
The semiconductor company did not give specific reasons for the departure of Paul Jacobs but said it wanted to stay independent and continue with its business plans. Qualcomm board reached that decision following Paul Jacobs’ notification to the Board that he has decided to explore the possibility of making a proposal to acquire Qualcomm.
Qualcomm CEO Steve Mollenkopf, as part of the long-term cost optimization plan, outlined a plan to cut more than $1 billion in costs and boost profits to more than $7 per share by 2019 by resolving disputes with customers such as Apple and Huawei.
Paul Jacobs in his statement said he believed that Qualcomm could strengthen itself in the global chip business by going private.
“There are clear merits to exploring a path to take the company private in order to maximize the company’s long-term performance, deliver superior value to all stockholders, and bolster a critical contributor to American technology,” Paul Jacobs said.
Paul Jacobs has reportedly made attempt to put together a big offer to acquire Qualcomm by reaching out to investment firms including SoftBank Group’s Vision Fund.
Even if SoftBank, a Japanese telecom group with technology investments around the world, wanted to join Jacobs’ bid, it could face conflicts given its ownership of British chip designer ARM Holdings.
Association with any foreign fund or entity will invite criticism from the U.S. administration because the Broadcom attempt was stopped citing national security interests. US did not want China to grow in wireless market. U.S. feel that China’s growing influence in wireless market will pose challenges to U.S.
Baburajan K
