Next week begins a new era at Aliso Viejo’s QLogic Corp.
Simon Biddiscombe, the company’s chief financial officer, is set to take the reins as chief executive at the maker of electronics for data storage networks.
He’ll be just the third boss QLogic has known since its 1994 spinoff from Costa Mesa’s Emulex Corp.
The move marks QLogic’s second attempt at a transition to a new chief executive after 15 years under the leadership of H.K. Desai, one of the county’s longest-running technology executives.
QLogic sees some $600 million in yearly sales and had a market value of nearly $2 billion last week. The company makes networking chips, circuit boards and switches that speed the flow of data.
Desai, who’s currently chairman, is set to stay on as executive chairman, a newly forged role that will have him focus on technology, product strategy, customers and acquisitions.
Biddiscombe, who will take on a board seat, is set to handle daily operations.
“It’s a natural progression,” said Brent Bracelin, senior analyst at Pacific Crest Securities Inc. in Portland, Ore. “It’s a smooth transition.”
Not a lot is known about Biddiscombe, a 43-year-old who QLogic declined to make available for this story.
He has held a series of senior executive positions in finance in the past decade at a handful of local technology companies.
Biddiscombe has been QLogic’s senior vice president and chief financial officer since early 2008, when he was recruited from a similar post at Newport Beach chipmaker Mindspeed Technologies Inc.
Biddiscombe spent five years at Mindspeed in various finance roles.
“He is a very strong customer advocate,” said Raouf Halim, Mindspeed’s chief executive. “He was involved as we made multiple strategic decisions. As we went through these decisions, he would always bring it back to the customer. That’s a quality that’s very rare in CFOs.”
Biddiscombe doesn’t have an engineering background.
“But sometimes that’s a good thing,” Halim said. “Maybe it’s time for that at QLogic.”
Conexant, Wyle
Before Mindspeed, Biddiscombe was at neighboring chipmaker Conexant Systems Inc. as vice president of finance and controller for a Conexant unit.
Mindspeed spun off from Conexant in 2003 in a deal Biddiscombe worked on with Halim.
Biddiscombe’s earliest executive posts were as chief financial officer and chief operating officer for Irvine-based Wyle Electronics Inc., an electronics distributor that was bought by Germany’s Veba AG for $810 million in 1997.
Veba now is part of Pennsylvania’s PPL Corp.
Biddiscombe also serves on the advisory board for the Center for Corporate Reporting & Governance at California State University, Fullerton’s business school.
Wall Street seems to approve of Biddiscombe, who’s been a regular on QLogic’s conference calls. One analyst called him a good communicator with experience at publicly traded technology companies.
“I think Simon is a very capable, very qualified executive who brings a great deal of technology expertise,” Bracelin said. “He has built a very solid relationship with Wall Street and the investment community.”
Analysts and investors also like that Desai, the driving engineering force at QLogic, plans to stick around for a few years in a slow handoff.
“Some investors could be nervous about the future of the company as H.K. passes on the baton,” said Kaushik Roy, an analyst at Wedbush Securities Inc. in San Francisco. “But H.K. has signed a contract, and we have been assured that he will remain involved and active for the next three years, which should alleviate some investor concerns.”
Desai outlined his plans in a call with analysts last month.
“I will be working day-to-day every day here at QLogic for the next three years,” he said. “I’m going to focus day-to-day on product roadmap and technology roadmap, product priorities and also on expanding and continuing our customer relationships. There’s to be more focus on that and also helping Simon on some of the M&A activity.”
Desai, 64, hails from India. He took over in 1996 after the departure of early chief Mel Gable, who left shortly after the spinoff from Emulex, now QLogic’s top rival for a piece of profitable networking electronics known as host bus adapters.
QLogic customers include Hewlett-Packard Co., IBM Corp., EMC Corp. and others.
Desai had kept his retirement and succession plans close to the vest after an initial attempt to step back didn’t work out.
Prior Pullback
Three years ago, Desai tried to pull back when he handpicked IBM veteran Jeff Benck.
Benck left in 2008 after Desai and QLogic’s board couldn’t come to terms on succession timing. He was quickly scooped up by Emulex, where he’s now president and chief operating officer and in line to succeed Chief Executive James McCluney.
Desai joins a handful of other longtime technology executives here who’ve stepped back from day-to-day roles.
Emulex’s formative leader Paul Folino left the chief executive post in 2006.
At Aliso Viejo business software maker Quest Software Inc., Doug Garn succeeded longtime chief executive Vinny Smith in 2008.
Analyst Bracelin said he doesn’t expect to see much change in terms of QLogic’s culture.
“It’s important to note that H.K. isn’t leaving yet,” he said. “He will take himself out of the day-to-day stuff and go back to what he enjoys.”