14:03 DJ =DJ Qualcomm CFO Thornley Says Spinco IPO Now Unlikely
By Johnathan Burns
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Qualcomm Inc. (QCOM) Chief Financial Officer Anthony
Thornley said Tuesday it is likely there will be no public offering of its
chipset manufacturing business Spinco, which is to be spun off to shareholders
later this year.
"(With) current market conditions, there's a reasonable possibility we won't
do an IPO," he said. "The chip company doesn't need the cash."
Qualcomm is spinning off its chipset business to compete better in the
chipset market. The spin allows Qualcomm to aggressively protect its
intellectual property rights on wireless technology without damaging chipset
sales.
Thornley, speaking at a Merrill Lynch Global Communications Investor
Conference in Manhattan, also said Qualcomm's licensing and royalty position
is as strong in wideband code-division multiple access (WCDMA) wireless
technology as it is in current CDMA technologies.
Even so, Thornley said Qualcomm's CDMA2000 wireless technology, the
next-generation competitor to WCDMA, will provide carriers cost savings.
He said carriers such as Verizon Communications (VC) and Sprint PCS (PCS)
will be able to gain market share in the United States because the technology
will provide them a competitive advantage.
Additionally, Thornley said the expected slowdown in handset sales growth
this year is mainly based on handsets using the European technology, not CDMA.
"There's no question the slowing economy has an impact on markets like the
United States, but I think fundamentally the factors are different for CDMA,"
he said.
Thornley also said he isn't concerned that carriers have built up large
inventories of handsets.
"Our information suggests there's no significant inventory buildup," he said.
Qualcomm expects more than 90 million CDMA-based handsets will be sold
globally this year.
Thornley also said recent decisions by Korean wireless service providers to
use a technology migration path to WCDMA was influenced by their hopes of
drawing investments from Japanese and European service providers. He said
those Korean carriers still have the option of choosing CDMA2000 even as their
network upgrades progress.
-By Johnathan Burns, Dow Jones Newswires; 201-938-202;
johnathan.burns@dowjones.com
(END) DOW JONES NEWS 03-13-01
02:03 PM |
