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CHARLIE.THOMPSON
Dave didn't see the shift to tablets. Wasn't ready.
CHARLIE.THOMPSON
But not in ISIL's current form. Losing BU's must be cut first.
Silicon Valley Nation: Intersil's Bell resigns, what's next?
Brian Fuller
12/14/2012 1:00 PM EST
SAN FRANCISCO -- Dave Bell fell on his sword this week at long-suffering Intersil, resigning his post as CEO with the sound of impatient Wall Street fingers tapping incessantly in the distance.
One Wall Street firm, Deutsche Bank, opined, "While we appreciate the strategic changes Mr. Bell attempted at ISIL, we believe the transformation of the company was simply taking too long and was too punitive financially to revenue growth and profitability. Consequently, we view this change as being necessary and a positive as hopefully it reflects a sense of urgency at the Board level to improve upon such metrics/execution."
It's a rare blotch on the career of a guy well respected in the analog community, who joined Intersil after a fine dozen years with Linear Technology.
But the situation raises a question we don't often grapple with in our industry: Do we hold our boards of directors accountable enough? Or conversely, do our CEOs tend to pack their boards with "their own guys" to insulate themselves from harm? (Longtime Silicon Valley engineers are right now flashing on Al Stein at VLSI Technology).
Let's look at the case at hand: Bell became Intersil CEO on Feb. 13, 2008, and had been president and COO before that. Of the nine Intersil board members listed today, eight of them predate Bell's arrival. Five of the seven have served on the board for at least 10 years. Intersil stock has underperformed competitors since 2008, and even before that was in the middle of the pack.
If you look at the last four years, fingers could clearly point at Bell's leadership.
"I think that Intersil had been overextended for quite some time," said Steve Ohr, an analog semiconductor analyst with Gartner Group. "Dave Bell had visions of making Intersil a billion-dollar company, with acquisitions as well as organic growth. But if you buy another company or another business, you want it to be accretive on Day One, not next year or the year after that. Dave wound up fighting wars on too many fronts."
Next: Reconciling paths
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truekop
12/14/2012 2:03 PM EST
Intersil should ideally merge with one of the big analog players. Their power management portfolio should be a very good fit.
@ Brian any insights into possible merger of Intersil with one of the large Analog Players(ADI or Maxim or Linear)
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Comfortable
12/14/2012 2:28 PM EST
Power management is a good fit? THAT is the problem. Power management has become commodity. Their problem is a lack of diversity that should be well under way by now.
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SP_#3
12/14/2012 7:19 PM EST
mcleod will hwelp sort that out - after all he sold national to ti because he couldnt make things work. woe is the plight of the intersil employees
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Brian Fuller2
12/19/2012 4:13 PM EST
No insights, but given that Maxim seems more open to acquisition and Linear just made its first-ever acquisition (Dust Networks) last year, the possibility is definitely there.
Or a big digital player in need of analog expertise might consider it.
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CHARLIE.THOMPSON
12/20/2012 7:50 AM EST
But not in ISIL's current form. Losing BU's must be cut first.
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CHARLIE.THOMPSON
12/20/2012 7:49 AM EST
At a P/E of over 100 don't expect any larger company to pick up ISIL without considerable fat trimming.
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truekop
12/14/2012 2:45 PM EST
@comfortable i understand that is the problem and was offering a possible solution which would be to merge with a bigger analog player with a slightly weaker presence in the power management market...
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sranje
12/15/2012 12:56 PM EST
Dave Bell is certainly among the most respected CEOs among analog IC companies. His expertise in Power IC business is also legendary and illustrated by visionary GaN-on-Silicon IC patents.
One of the problems is the slow-down in PC business - one of the core revenue source for Intel. Another might the ever-increasing dominance of all things power by TI.
One should certainly wish well to Dave and commend him for his integrity and leadership.
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sranje
12/15/2012 12:59 PM EST
Ooops - Intel should have been Intersil.
Thinking about the rumors on Intel-nVidia and the new CEO there... If that happens it would be an earthquake event -- but perhaps also timely and necessary
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Comfortable
12/16/2012 2:25 PM EST
If TI is dominating power, then please explain how Dialog has grown from $85 Million in 2005 to $750 Million in 2012. Everyone in power semiconductors is flat to down for the past several years. Those guys from Stuttgart are growing at 28%!
[Answer: Apple thinks Dialog power is good enough. 25,000 patents and the world leadership of TI doesn't count. That was my point about why high volume, high margin power semiconductors are old-hat. It's over. Time to move on to move valuable products.]
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CHARLIE.THOMPSON
12/20/2012 7:50 AM EST
Dave didn't see the shift to tablets. Wasn't ready.
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sranje
12/15/2012 1:02 PM EST
Ooops - "Intel" should have been Intersil
Too distracted about the rumors on Intel-nVidia...;-))
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pmoyle111
12/17/2012 4:21 PM EST
Or conversely, do our CEOs tend to pack their boards with "their own guys"
it is circular - ceo's from one company are the board members of another and vise versa. Then you just have a mesh of back scratching....
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Brian Fuller2
12/19/2012 4:16 PM EST
Absolutely right, but I'm not sure whether the answer is more "outsiders"... at the end of the day, it's a deeply technical industry that needs technical leadership... and maybe more vigilant investors....?
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SemiRunner
12/19/2012 4:58 PM EST
I have to agree with previous posts pointing to the fact that Dave Bell is an outstandig leader and his work at Intersil was a challenging endeavor. I generally feel that Wall St pressure on BOD's is causing a lot of problems for companies like Intersil that want to move into new growth markets. The change expectations are too high and the time allowed is too short. Look around the the valley at numerous companies that are fully capable of moving into a new markets but are now allowed because of short sighted boards. My opinion is that Dave Bell had the company on the right track but the time required was too short.
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CHARLIE.THOMPSON
12/20/2012 7:46 AM EST
Dave Bell did not have the company on the right track. He purchased too many "loser" companies. The Board finally figured it out. 3/4 of the companies were an op-ex drag and destined to stay that way for years to come. Hype doesn't pay the bills.
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