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CyberBucks—AMCC’s Rickey driving firm’s successful ride

Qualcomm Re-evaluates Its Security Issues in Wake of Laptop Theft

To paraphrase that bluesy Sinatra song, it was a very good year for San Diego’s Applied Micro Circuits Corp. and CEO Dave Rickey.

Now in the middle of a $4 billion acquisition of Silicon Valley chipmaker MMC Networks, AMCC is riding a wave that seems to get bigger as its Internet and wireless influenced chip manufacturing business continues to expand.

Also getting bigger is the amount of stock options that Rickey has exercised based on the SEC filings.

For the past 12 months, Rickey’s exercised thousands of shares almost on a monthly basis. On two separate months, he cashed in on 250,000 shares each, resulting in sales of $41 million and $26 million, respectively.

All totaled for the year, the amount of options that Rickey has sold on the market totaled more than $146 million.

Rickey said he’s using the cash for his family’s long-term needs and for a foundation he’s set up.

“I’d rather give the money away when I’m alive than when I’m gone,” Rickey said.

Rickey’s wealth is considerable. Last year his board was so thrilled with the job he did, and how their net worth skyrocketed, they awarded him 2 million in stock options. That brought the number of options he owns to more than 2.6 million. Using AMCC’s closing price on Sept. 18 at $175.25, that would translate to more than $465 million.

Of course, the company’s price could also plummet, which could change everything. But given the market for integrated circuits used in the transmission of data over high-speed networks, that doesn’t appear too likely.

By the way, given the company’s performance, Rickey may well be San Diego’s most underpaid CEO, at least in terms of his annual salary. Last year he received $350,000 in salary, and for the current fiscal year, it was bumped up to $400,000.

He can always fall back on exercising all those stock options if things get a little tight.

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Jacobs’ Laptop Swiped: You just can’t trust reporters.

That might be the conclusion of Irwin Jacobs, Qualcomm Inc.’s founder and CEO, after his experience at the Irvine Hyatt on Sept. 16. After giving a presentation to a group of technology reporters and editors, Jacobs answered more follow-up questions with a smaller group. When he turned around to leave the room he discovered his $4,000 laptop he had used in the presentation was missing.

Jacobs, who takes the laptop everywhere, said the machine contained five years of E-mails, spreadsheets, and lots of other company information.

Qualcomm spokeswoman Christine Trimble refused to say anything about the data and whether it was “classified,” but did say it was backed up on another computer.

Since the apparent theft, which is being investigated by both Irvine police and the FBI, Qualcomm has been in the process of evaluating its security measures, Trimble said.

Theft of PCs at trade shows and other public events isn’t that unusual, said Bruce Ahern, a local high-tech industry analyst.

“A client had one stolen at a trade show in New Orleans recently,” he said. “We’re pretty sure it was stolen for its intrinsic value, but the fact is we’re not absolutely certain.”

Ahern said it’s possible the data in Jacobs’ PC could be accessed by a proficient hacker, but it might also have some “lock” on the data that may prevent, or at least make it very difficult, to access.

The missing laptop was the subject of a few jokes, particularly at the conference the following day before a session titled, “Are we safe? A look at computer security.”

High-Tech Investment: VC investment in San Diego hit $415 million in the first half of this year, an 86 percent increase from the same period last year, according to a recent report by Broadview, a New York-based investment and consulting firm.

The report noted San Diego has continued to benefit from an ongoing transition from military technologies to commercial applications, particularly in the growth of a wireless telecommunications industry.

“This growth, coupled with the significant presence of Qualcomm’s worldwide headquarters, as well as the presence of Ericsson, Nokia and Motorola, is solidifying San Diego’s position as global competitor,” said David Creamer, Broadview’s managing director.

Besides large investment in such local firms as Ensemble Communications, Littlefeet, Magis Networks, Widcomm and Wireless Facilities, the region also experienced a higher number of mergers and acquisitions.

During the first half, the area had 23 transactions in information technology, communications and media, representing a total value of $11 billion, which was 20 times the value in last year’s first half, Broadview said.

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OMM Files IPO: OMM Inc., a San Diego-based developer and supplier of switches for fiber-optic communications networks, filed an S-1 statement to issue up to $100 million in stock last week.

Founded in 1997, the company was primarily an R & D; firm that generated $413,000 in revenues for the first time during its last quarter. Net losses for this year thus far are $19.4 million. For all of last year, the company lost $7.4 million.

OMM’s switches are used to control the flow of data through fiber optic networks. Among its customers are Cisco Systems, Nortel Networks, and Siemens AG.

OMM is to be traded on Nasdaq under the symbol, OMMI. It has 211 employees.

The lead underwriter for the issue is Credit Suisse First Boston Corp. with participation from Chase H & Q;, CIBC World Markets and Dain Rauscher Wessels.

The market that OMM operates in could reach $90 billion by 2003, according to RMK, an industry research firm.

Novatel Prices Its Shares: Novatel Wireless, which filed its S-1 in July for some 7 million shares, said its IPO share price will be between $10 to $12, which should raise at least $70 million for the San Diego developer and maker of wireless data modems and software.

The 4-year-old firm has an accumulated deficit of more than $53 million. For the last six months, it had revenues of $15.9 million but had a net loss of about the same amount.

The underwriters for the stock to be sold on Nasdaq under the symbol NVTL is Credit Suisse First Boston, U.S. Bancorp, Piper Jaffray and Banc of America Securities.

Novatel has boosted its employment from 56 at the end of 1998 to 248 as of Sept. 1.

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Cardiff Software Gets $10 Million: San Diego-based Cardiff Software said it received $10 million in new capital funding recently, led by the Dicom Group Plc, a British software company, Adobe Ventures LP, the VC partner affiliate of Adobe Systems, and HarbourVest Partners.

The company said it plans to use the funds to accelerate the sales of its new online eForms and personalization products.

Please send high-tech finance items to mallen@sdbj.com.


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