"IPO Spotlight: Qualcomm Unit To Offer Up To $100M In Stock"
Dow Jones Newswires
Issuer: Qualcomm Spinco Inc., a unit of Qualcomm Inc. (QCOM) that will be renamed before completion of the
initial public offering.
Description: Makes code division multiple access, or CDMA, integrated circuits and system software for wireless voice and data communications products.
Location: San Diego
Offering: Up to $100 million in common shares
Shares Outstanding After Offering: N/A
Price talk: N/A
Market Cap: N/A
Underwriters: Lehman Brothers, Goldman Sachs & Co.
Proceeds: For working capital and general corporate purposes, including product development, selling and
marketing, and potential acquisitions.
Proposed Symbol: N/A
Dividend: None planned
---Earnings---
9 months ended June 25 2000 1999
Revenue $964,714,000 $788,166,000
Net income 82,582,000 195,363,000
Year Sept. 30 1999 1998
Revenue $1,148,272,000 $879,858,000
Net income 274,973,000 158,939,000
---Risk Factors---
Risks include no history as an independent company; a market characterized by
frequent technological innovation and declining selling prices; dependence on
widespread deployment of CDMA technology; need for industry to deploy 3G
wireless standards based on CDMA technology; a limited number of customers
that account for a significant portion of revenue; dependence on a limited
number of third-party manufacturers; dependence on pass-through licenses
from third party manufacturers to protect against patent infringement claims;
possible product defects; fluctuations in quarterly results; possible inability to
sustain current growth rate; intense competition; risks from operations outside
the U.S., which account for majority of revenue; foreign currency fluctuations;
possible disruptions from acquisitions or mergers; cost of enforcing intellectual
property rights; possible claims of intellectual property infringement by third
parties against company; need to attract and retain qualified personnel; possible
product liability claims or recalls; possible unforeseen delays of or defects in
products; and possible health and safety risks of wireless handsets.
Other risks include Qualcomm's licensing of CDMA technology to other
integrated circuit manufacturers; Qualcomm's right to license or sublicense
certain of company's intellectual property to third parties; need to manage
growth effectively; possible decreased purchasing power or less favorable
licensing terms after separation from Qualcomm; inability to pass through or
sublicense certain of Qualcomm's intellectual rights after the separation; possible
failure of transitional services provided by Qualcomm to meet company's needs;
possibility that Qualcomm won't complete distribution of company's common
stock by August 2001 as planned; possible failure to make transition from
Qualcomm's information technology systems; possible need for additional
capital that may not be available; potential conflicts of interest with Qualcomm;
directors', executives' and employees' positions with and/or stakes in
Qualcomm; possibly limited ability to do business with Qualcomm's
competitors; control by Qualcomm, which will own more than 90% of
outstanding stock after the IPO; possibly limited ability to raise capital or issue
common stock due to relationship with Qualcomm; possible stock-price
volatility; management's broad discretion over use of IPO proceeds; future
stock sales that could depress share price; possible securities class-action
litigation; and antitakeover provisions.
---Management---
Name Age Position
Irwin Mark Jacobs 66 Chairman
Richard Sulpizio 50 Chief executive
Donald E. Schrock 54 President, chief
operating officer
Anthony S. Thornley 54 Interim chief financial
officer
Biographies:
JACOBS has been chairman and chief executive of Qualcomm since July 1985
and was named chairman of Qualcomm Spinco in July 2000. He previously was
executive vice president of M/A Com Inc. From October 1968 to April 1985,
he held various positions, including chairman, president and chief executive, at
telecommunications company Linkabit, which co-founded and became
M/A-Com Linkabit after 1980.
SULPIZIO was named chief executive in July. At Qualcomm, he has been
president since 1998 and chief operating officer since 1995. He joined
Qualcomm in 1991 as vice president, information systems, from Unisys Corp.
(UIS), where he worked for eight years. He previously spend 10 years at Fluor
Engineering and Constructors.
SCHROCK was named president and chief operating officer in July. He has
been senior vice president of Qualcomm and president of the QCT products
unit since 1997. He joined Qualcomm in 1996 as corporate vice president. He
previously was group vice president and division manager at Hughes Aircraft
Co. He has also held positions with Applied Micro Circuits Corp. (AMCC),
Burr-Brown Corp. (BBRC) and Motorola Semiconductor.
THORNLEY has been interim financial chief since July 2000. At Qualcomm, he
was named chief financial officer in March 1994 and executive vice president in
November 1997. He previously spent 16 years with Nortel in various positions,
including vice president, public networks. He has also worked for Coopers and
Lybrand.
---Shareholders---
Shareholder Shrs Before Offer After Offer
(percent owned)
Qualcomm Inc. N/A (100%) -a N/A
a. No Spinco executive or director owns more than 5% of Qualcomm shares.
Note: All of the above material has been taken from documents the company
filed with the Securities and Exchange Commission.
- Nick Baker; Dow Jones Newswires; 201-938-5176 |
