There had been some speculation over the past few weeks that Qualcomm may split its patent and chipsbusiness but according to a new report published by the company it has decided not to do that. Qualcomm has determined that it’s not going to be the correct strategic move to break it up in a separate licensing business and chip design unit.
The company had conducted this review of its core business at the insistence of activist shareholder Jana Partners, which disclosed Qualcomm holdings worth over $2 billion earlier this year in April.
The idea that drove this review was that the company’s patent licensing business is more valuable and it should be separated from its chip business but the committee found that this would not be a strategic move.
Business review involved the company’s board of directors, consulting firms, several law firms as well as investment banks. Options considered by the company included a total split, partial split, tracking stocks as well as a number of other structures, reveals executive chairman and chairman of the Qualcomm board Paul Jacobs.
Qualcomm’s final report following the review firmly establishes that the two core units of the business go well together and it would not make sense to split them up, so it’s not splitting them up.
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