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Reuters
The joys of divorce: will Qualcomm split?

Examples of failed technology mergers abound, but demergers have a better record—which is a chief reason why they are back in fashion. Since PayPal, a digital-payment service, officially took its leave of eBay, an e-commerce giant, on Friday, two other possible tech splits have made headlines. One is Yahoo, a troubled web portal, which has filed to register a spin-off company that will include its 15% stake in Alibaba, a Chinese e-commerce group. And reports say that today Qualcomm, a chipmaker, will announce a sweeping strategic review to consider its break-up into a production business and a patent-licensing operation. Yahoo’s motivation is tax: it wants to avoid a bill when it sells its Alibaba shares, which are worth $32 billion. Qualcomm seems to be reacting to shifts in its industry, in particular rapid consolidation among chipmakers. Other tech firms are said to have spin-off plans in the drawer. Expect more corporate divorces.

Jul 22nd 2015
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