Qualcomm revamp urged

Jana Partners wants the San Diego firm to consider spinning off its chip business.

Qualcomm Inc. defended its corporate structure Monday after an activist investor urged a revamp of the San Diego chip maker, including the possible spinoff of its chip business.

Hedge fund Jana Partners, one of Qualcomm’s largest shareholders, wants the semiconductor and telecommunications firm to accelerate the buyback of stock, shave costs and consider breaking off the chip business from its patent-licensing arm.

In a letter to its investors, Jana also called for Qualcomm to reduce the size of its board, select new directors and make changes to executive compensation that would align pay more closely with boosting value for shareholders.

Jana recently invested more than $2 billion in Qualcomm.

In response, Qualcomm pledged to maintain an “active dialogue with all stockholders” and act in their best interests. The firm said previous reviews showed its current business model creates “more value for stockholders than could be created through alternative corporate structures.”

“We will continue to evaluate opportunities to enhance stockholder value and are committed to pursuing the right course of action for all of our stockholders,” the company said in a statement.

Qualcomm’s stock is down more than 10% over the last year.

After news of the Jana letter, Qualcomm shares opened nearly 3% higher than their closing price Friday. They fell later in the day, however, closing down 43 cents, or less than 1%, to $68.73.