A total of eleven director nominees that had been picked by Silver Lake Partners, a private equity firm, and Broadcom have been rejected by Qualcomm. This has raised the possibility of a proxy battle being waged between the two chipmakers. Earlier in the month Broadcom made its intentions to replace the board of Qualcomm with its own nominees known formally.
This comes in the wake of Qualcomm rejecting a cash-and-stock bid placed by Broadcom valued at $103 billion on the basis that it was a gross undervaluation of the company. In place of the 11 nominees that Broadcom had proposed Qualcomm will be nominating the current directors for re-election during the annual meeting scheduled for next year. On the list presented by Broadcom included a former executive of Nokia as well as the former chairman and director of Dialog Semiconductor.
No added value
According to the governance committee of Qualcomm, the nominees that Broadcom presented were inherently conflicted. Additionally they would not add value to Qualcomm’s board as they did not possess incremental expertise or skills.
“These nominees are inherently conflicted given Broadcom’s desire to acquire Qualcomm in a manner that dramatically undervalues Qualcomm to Broadcom’s benefit,” said Qualcomm.
The rejection of Broadcom’s board nominees comes in the wake of Qualcomm obtaining a permit allowing the chipmaker to test driverless cars on California’s public roads. The permit was issued by the state’s Department of Motor Vehicles.
Infotainment and telematics
Three months ago the 9150 C-2VX chipset was announced by Qualcomm and it allows vehicles to communicate not just with each other but also with infrastructure. According to Nakul Duggal, a vice president at Qualcomm, the technology is compatible with chips dedicated to driverless cars. Currently Qualcomm’s technology focuses on infotainment and telematics systems. Though the deal is yet to close, last year Qualcomm declared intentions to acquire NXP Semiconductors, which sells various automotive components.
Already Qualcomm has conducted field trials using Ford vehicles which bear the chipset. The trials have so far been conducted in and around San Diego, the headquarters of the chipmaker. Other tests are expected to take place in Japan, Italy, Germany, China and Michigan.
Qualcomm is not the only chipmaker that has obtained a permit to conduct tests for autonomous cars in the state of California though as Samsung and Nvidia have also received authorization. Nvidia’s automotive partners include Volvo, Toyota and Tesla. While Intel has indicated that it is interested in driverless car systems, it hasn’t sought a permit to conduct field trials in California.