[News] Broadcom will fire a third of Qualcomm staff

[StyM]

http://www.fudzilla.com/news/45223-b...qualcomm-staff

It is starting to look like Broadcom's take over of Qualcomm will be less of a merger and more of an asset strip.

While most people associate Broadcom with wi-fi and Bluetooth chipsets and a few processors, Broadcom has a company called Avago which is a spin-off of Hewlett-Packard. In recent years it has been buying and asset stripping companies. This has resulted in excellent financial performance, but the outfit is a tech equivalent fo a car wrecker.

The company is run by "finance geek" Hock Tan. Tan has confirmed that life will be bleak for Qualcomm workers if it takes over and a third of them will be made redundant.

Broadcom is famous for taking over and removing a third of the workers of the companies it acquires. It is an automatic figure that is fixed in Tan's head. In the last four years and five acquisitions by Broadcom, around 30 percent of the employees of the five companies bought ? some 5000 people ? have lost their jobs. It includes figures for business units which are sold off.

Tan said he expects a Qualcomm acquisition would see a jobs shrinkage from 5,500 to 1,500 as a result of unit sales.

Tan said his strategy was necessary for an industry where growth has slowed and winning market share has become difficult.

You would think you could manage your way out of a situation and come up with new products and an expanded business structure, right? Well, no. Tan says that sort of thinking is living in the past and managers who thought they could engineer their way out of problems were fighting the battles of the past.

[drmrlordx]

Wait, what? Qualcomm is busy trying to break into the server market, and Tan wants to fire a third of their workforce?

[AbortRetryFail?]

It is starting to look like Broadcom's take over of Qualcomm will be less of a merger and more of an asset strip...

In the 'modern' global economy, that's called creative destruction.

In the 1980s it was called Vulture Capitalism.

I'm sure Hock E is a bright guy. BC stock price has tripled over the last 3 years, but so has the P/E ratio (it's $60US+). And (gulp), with all this buy-outing and leveraging, they're sitting on one big, sweet pile of debt. It also looks like 'insiders' (execs) have been selling bunches of stock over the last 6 months...

Which brings to mind that nasty stock-options scandal from 10+ years ago that cost shareholders billions of dollars (just citing history -- not making accusations). In our current 'laissez-faire' regulatory and oversight environment (and looting of the US Treasury), it doesn't take a genius to see such shenanigans down the road from our global corporate titans.

But ... look on the bright side: There are bunches of cash-bloated Global Vultures out there waiting to pounce on the entrails of their fellow birds who stumble. Yipppeeee!