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Anyone else own QCOM and surprised by Broadcom's proxy vote scheme?
Old 01-19-2018, 04:00 PM   #1
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Anyone else own QCOM and surprised by Broadcom's proxy vote scheme?

I only own individual stocks in my "play portfolio" consisting of a total of 20K invested during the last two yrs before ER. Not for any reason other than to learn by doing which is the best way for me and for the fun of it. So its been 4 yrs now and am close to 36K total. Not all that great considering the market during that time, but like i said, for fun and learning. One of the stock i should not have bought, at least not in the low 70's was QCOM, but i did. One of my few losers, but I only bought ten shares (like I said, a "play portfolio").

Anyway, just got two proxy voting cards. One white one allegedly from QCOM, with a warning that Broadcom who is attempting a hostile takeover (60 cash, 10 in broadcom shares or 70 total while QCOM now hovering around 68) will be sending their own card ,a blue one, with a slate of board members who only want to accept the offer. Sure enough, I got that too, same day. Never had this experience before. Is such seemingly misleading action even legal?
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Old 01-19-2018, 06:02 PM   #2
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Yes, I believe it's SOP for an acquisition related proxy battle
https://en.wikipedia.org/wiki/Proxy_fight
the colored cards are like ballots in a snap election, incumbent gets white, challenger gets blue or sometimes gold. You get to vote on who makes money off the deal.

I've never owned shares of QCOM, closest I got was when one of my holdings was acquired by them a few years ago, but that was a cash deal thankfully. I see the lyrics to that Prince song describe its share price history very nicely.
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Old 01-19-2018, 09:18 PM   #3
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Yes, it is legal.

I owned some HP shares when there was a proxy battle between Carly Fiorina et al. and Hewlett's son et al. It was several months long and I received probably 6 to 8 proxy cards from each side for my shares. I think each side hoped the investors would simply vote whatever proxy cards they received -- since the last proxy voted was determinative, it behooved the warring sides to repeatedly send out mailers. In my case I actually owned shares in a few different places, so I probably had 20-30 proxy cards from that fight.

One side was white, one side was green in that case.
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Old 01-19-2018, 09:55 PM   #4
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I don't know anything about the proxy vote... but I'm watching this takeover attempt closely. I think everyone in San Diego is. QCom is like Kevin Bacon, here in San Diego, 6 degrees (at most) of separation - everyone knows someone who works there, or has worked there in the past. I have at least a dozen former coworkers/friends who currently work there. (I'm the rare engineer/programmer in San Diego who never worked for them)
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Old 01-19-2018, 10:25 PM   #5
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If you own a significant number of shares expect to receive more than just a proxy voting form.
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Old 01-20-2018, 04:32 AM   #6
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Only thing I've got is a notice of Contested meeting, listing the board election, ratification of auditors, blah blah blah. Don't see anything about the Broadcom offer. Is the OP saying that the slate of directors are put forth by Broadcom?

I've still got some shares bot in 1996, about 2 1/4 cost. Don't need the forced sale and resulting gain. Might gift some to my DAF, but not sure whether the charitable donation would be deductible for me. Maybe just pay the tax and spend it.

Ah, first world problems.
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Old 01-23-2018, 08:14 PM   #7
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Quote:
Originally Posted by mamadogmamacat View Post
I only own individual stocks in my "play portfolio" consisting of a total of 20K invested during the last two yrs before ER. Not for any reason other than to learn by doing which is the best way for me and for the fun of it. So its been 4 yrs now and am close to 36K total. Not all that great considering the market during that time, but like i said, for fun and learning. One of the stock i should not have bought, at least not in the low 70's was QCOM, but i did. One of my few losers, but I only bought ten shares (like I said, a "play portfolio").

Anyway, just got two proxy voting cards. One white one allegedly from QCOM, with a warning that Broadcom who is attempting a hostile takeover (60 cash, 10 in broadcom shares or 70 total while QCOM now hovering around 68) will be sending their own card ,a blue one, with a slate of board members who only want to accept the offer. Sure enough, I got that too, same day. Never had this experience before. Is such seemingly misleading action even legal?
Why wouldn't it be legal? The QCOM management doesn't own the company, the stock holders do. They have the advantage of soliciting their choices for the board, but other stockholders (with enough money) can solicit their own slate of candidates. Broadcom has made an offer for QCOM for $70/share ($60 in cash, $10 in Broadcom stock). That offer was made when QCOM was about $55/share. QCOM has moved up (partially) because of that offer. The fact that QCOM is trading near the offer price indicates that many stockholders believe that the offer is likely to be raised.

The QCOM management hasn't been doing such a bang up job over the last couple/few years, given the stock was $80 or so in 2014 and the past three plus years have been up up up in terms of the market in general and semi's in particular.

I am long QCOM (actually it is my son that is long the stock as I bought it for his minor account, his basis is aprox. $52/share and I picked up the shares in April 2017.) Personally, I wouldn't be crying too much if Broadcom's takeover is successful as I think they are a somewhat undervalued semi. I only wish the offer was higher with more stock and less cash.
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Old 01-24-2018, 12:02 AM   #8
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From reading the card and the paperwork sent with it, yes my understanding was the blue card was put forth by Broadcom. I bought it at 73 in 2014, which was a dip at the time, just thinking it was an interesting sector to have in my play portfolio and also it was one of the few survivors of the dot com craze, so that struck my fancy at the time. Since my first post, I did an internet search and found speculation that the broadcom CEO, based on past acquisition behavior may up the offer to 75. If he does i hope its all cash, as the sector no longer interests me much, other than my Apple shares(who does not own at least a bit of apple) Just speculation of course, as you can also find some rating group that puts QCOM as going up to 86 (presumably w/o the takeover being successful) So grain of salt on both of those really, the former just seems more reasonable. Quite fun for a relative neophyte like me
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Old 01-24-2018, 09:56 PM   #9
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Interesting article on mutual funds who own QCOM, includes two Vanguard stock funds that i know many have mentioned owning. Also makes clear it was Broadcom and not "shareholders" who proposed the "blue card" proxy list of directors. Too bad about the EU fine, suppose it makes a sweeter offer by AVGO less likely.

https://www.investopedia.com/article...edium=referral
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Old 02-04-2018, 04:43 PM   #10
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Great, looks like i may just get a deal that is a gain for me. Who would have thunk that with this relative dog (said with affection of course for dogs everywhere):

https://www.reuters.com/article/us-q...-idUSKBN1FO0SG
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