Times have been good for Conexant Systems Inc.,maybe too good.
The Newport Beach-based chipmaker recently saw its stock hit a 52-week high after getting an upgrade from Deutsche Securities. Conexant counted a recent market value of $1.1 billion.
The company has landed in stories in national publications.
And the company is a favorite of populist stock analyst Jim Cramer of “Mad Money” on CNBC.
But one of Conexant’s biggest insiders recently said it is pulling the plug on its stake in the company.
According to federal filings earlier this month, Ft. Worth, Texas-based Texas Pacific Group plans to sell nearly 8 million shares of Conexant, a stake worth about $18 million.
It owns the shares through two investment arms, TPG Partners LP and TPG Parallel I LP.
Texas Pacific’s stake represents about 2% of Conexant’s shares.
A good portion of the holding came from Red Bank, N.J.-based GlobespanVirata Inc., which Conexant acquired in 2004.
In all, Texas Pacific has more than $20 billion under management.
Conexant Chief Executive Dwight Decker also plans to sell some shares. His planned sale is worth less than $400,000.
Texas Pacific’s sale adds up to a decent amount of shares, prompting questions about whether it’ll impact Conexant’s stock.
The company may be able to withstand it. Conexant is much improved since Decker returned last year and put together a turnaround plan to stem losses.
In the quarter ended Sept. 30, Conexant beat its own target of returning to profitability by year’s end.
It reported net income of $50.6 million compared to a loss of $31.5 million during the year-ago period.
Sales climbed 9% from the prior quarter to $215 million and were flat with a year earlier. Analysts were looking for $208 million in sales.
For the current quarter, Conexant said it expects $225 million in revenue, more than prior estimates of $218.2 million.
In a note a few weeks after Conexant’s results, Deutsche Bank analyst Ben Lynch said investor sentiment is high and that the company continues to be well-positioned to hit its target of $260 million in revenue by the final quarter of next year.
Broadcom Expands Board
Irvine-based Broadcom Corp. has added its first female directors to its board: Maureen Grzelakowski, a Chicago-based consultant for Internet and telecommunications companies, and Nancy Handel, financial chief at Santa Clara’s Applied Materials Inc., a maker of chip production gear.
Grzelakowski held senior positions from 1996 to 1999 at Motorola Inc., including senior vice president, strategic marketing. From 1992 to 1995, she held several executive positions at AT & T; Corp., including vice president and general manager of the global switching systems business.
She now serves on the board of Simpsonville, S.C.-based Kemet Electronics Corp., a maker of aluminum capacitors.
Broadcom now has nine directors, six of them independent of management, including Handel and Grzelakowski.
VoIP Deal
A small New York telecommunications company plans to snatch up an Orange County Web phone service provider.
Fusion Telecommunications International Inc., which provides
Web access and voice over Internet protocol services, recently said it would pay $500,000 for Irvine-based iFreedom Communications USA, which markets VoIP service plans in Asia and elsewhere.
VoIP enables consumers to use Internet connections to make phone calls.
The deal is expected to close before the end of the year.
IFreedom has customers in the Philippines, Malaysia, Hong Kong, the U.S. and Britain.
It has more than 9,000 customers in 15 countries.
“The iFreedom sales, marketing and support staff will be able to benefit from Fusion’s infrastructure,” said Edward Weaver, chief executive of iFreedom.
Fusion had sales of about $50 million last year and has a market value of $67 million.
“This agreement gives Fusion a foundation to offer our products and services to several key markets in Asia,” said Matthew Rosen, chief executive of Fusion.
