Conexant Names Team to Head New Unit
Sketching the first outlines of what its Internet equipment unit will look like when it goes public, Conexant Systems Inc. said Wednesday that the division’s current head, Raouf Halim, will become the new company’s chief executive.
The Newport Beach communications chip maker also said in a press release that its chairman and chief executive, Dwight W. Decker, will be chairman of the as-yet-unnamed new company, but will not hold a management position. He will retain his positions at Conexant, which has four other divisions.
For nearly four years, Halim has been senior vice president and general manager of Conexant’s network access division--the unit that will be spun off as early as January.
Halim joined the company in 1991 when it was Rockwell Semiconductor Systems, a unit of Rockwell International Corp. Rockwell spun off the unit in January 1999. Prior to joining Rockwell, he worked for six years at Hayes Microcomputer Products Inc.
Conexant also said that its chief financial officer, Balkrishnan Iyer, will become senior vice president and chief financial officer of the new company. Iyer also will join its board of directors.
Halim, Decker and Iyer would not comment on the press release, citing a so-called quiet period during which restrictions are imposed on promotional statements.
Conexant said in September that it will sell about 20% of the proposed stock in the new company in an initial public offering and will distribute the remaining shares to Conexant shareholders.
The spinoff announcement drew praise from analysts and from the stock market, which boosted Conexant’s share price by 42% to $52.63 on the day following the news. Since then, however, the stock has suffered bruising losses, shedding half its value. Conexant stock lost $2.25 a share, or 7.9%, in Nasdaq trading Wednesday to close at $26.19.
Conexant’s networking division has doubled in sales in each of the past two years and is expected to reach $1 billion in revenue next year. The division’s top three customers are Cisco Systems Inc., Lucent Technologies Inc. and Nortel Networks Corp.
The remaining business consists of four Conexant divisions that make chips for mobile communications and broadband products, like cable modems, mobile phones, digital cameras and video games. The units will retain the company’s manufacturing and testing facilities.
