Broadcom Again Most Valuable OC Company
By Andrew Simons
Broadcom Corp. is back.
The Irvine chipmaker once again is Orange County’s most valuable public company, thanks to a surging stock and a pullback in the shares of Irvine-based Allergan Inc., now OC’s second-most valuable company.
“Maybe we could start making Botox,” joked Alan E. “Lanny” Ross, Broadcom’s chief executive, referring to Allergan’s flagship wrinkle-reducing drug.
As of last week, Broadcom counted a market value of $11 billion, versus $10 billion for Allergan, a maker of eye and other drugs.
For the past two years, Allergan reigned as OC’s most valuable company as the technology downturn took its toll on Broadcom’s once staggering market value.
During the tech boom, Broadcom’s value got as high as $60 billion, making it far and away OC’s most valuable company.
Broadcom’s shares peaked in 2000 and fell by more than 95% by late 2002.
Meanwhile, Allergan’s shares more than doubled in 2000. The drug maker’s stock pulled back for the next two years, but Allergan easily kept its lead on slumping Broadcom.
So far this year, Broadcom’s stock is up more than 140% as cost cutting has restored profits and sales are growing again.
Allergan’s stock also is up this year, though by a more modest 15%.
It hasn’t been a race until recently. Broadcom started surging in May, paused in August and starting climbing again to where they are now.
Broadcom’s stock comeback has boosted the chipmaker’s buying power.
Earlier this year, the company’s Ross said Broadcom would be looking for acquisitions,potentially large enough to double the size of the company.
There’s been no word on the company’s progress on a possible acquisition.
Broadcom’s rebound comes after a sharp downturn in January when cofounder and former chief executive Henry Nicholas shock-ed investors by announ-cing his resignation.
Broadcom has been in transition since late last year, when Ross came out of retirement to serve as chief operating officer.
Ross was named interim chief executive after Nicholas’ departure.
Ross has been heading up the search for a new chief executive and trying to change Broadcom’s image as a brash, young company to one of a more polished, mature one.
As part of the effort, the company started a campaign to boost its brand.
In one move, Broadcom leased 27,500 square feet of space in a Newport Beach high-rise office building next to John Wayne Airport and tacked its logo on two sides of the building.
The space houses some of Broadcom’s computer processing operations.
