China’s slowing economy is proving expensive for shareholders of Qorvo, the Greensboro-based company created this year after the merger of RF Micro Devices and Hillsboro, Ore.-based TriQuint Semiconductor. The company’s shares declined 14% on July 30, a day after it missed profit expectations of industry analysts, and in mid-August traded for about 15% less than when the merger took effect in January. Qorvo blamed slowing sales of its wireless infrastructure equipment and soft sales in China.
Most industry analysts view the dip as a blip, with 15 of 17 giving Qorvo a “buy” rating in August. “Qorvo is expected to leverage the core strengths of both the merged companies to rapidly translate research and development advances into large-scale production,” Zacks Investment Research noted in a July report. Merger-related cost cuts should save $75 million annually in 2015-16, while spending to develop products expands from $257.5 million last year, according to the company. Qorvo relies on mobile customers for more than 80% of its revenue, including industry giants Apple and Samsung, so it is trying to diversify. Qorvo will be a supplier for automotive antennae as manufacturers make their vehicles more compatible with wireless technology. The company also provided parts for NASA’s New Horizons space mission to Pluto.
When business rebounds, Qorvo will be ready to grow, company executives told analysts in July. It started hiring about 180 new workers this summer, including 50 in Greensboro, where it now employs 1,400.“We feel confident we can hit our model while making substantial investments in the process technologies and great products that sustain and enhance our competitive advantage,” Chief Financial Officer Steve Buhaly said. He and CEO Robert Bruggeworth sold a combined $3 million of shares when they traded at about $79 in July. Shares closed Aug. 19 at $56.
Briefs
WINSTON-SALEM — BB&T will acquire National Penn Bancshares for about $1.8 billion in cash and stock. The Allentown, Pa.-based bank has $9.6 billion in assets and 124 branches in Pennsylvania, New Jersey and Maryland. The deal, expected to close in mid-2016, will give BB&T the No. 4 market share in Pennsylvania. BB&T also completed its $2.5 billion purchase of Lititz, Pa.-based Susquehanna Bancshares, its largest acquisition to date. BB&T has $210 billion in assets and 2,149 offices in 15 states and Washington, D.C.
HIGH POINT — HAECO Americas will invest $11.3 million in an expansion and will add 127 jobs over five years. Formerly Timco Aviation Services, the division of Hong Kong-based HAECO Group designs and refurbishes aircraft interiors and employs more than 1,700 in the state. The company will build a 259,000- square-foot manufacturing facility near its Greensboro headquarters. The new jobs will pay an average annual salary of $60,114, higher than Guilford County’s $43,642. HAECO could receive a state grant of up to $294,000 if it meets hiring targets.
HIGH POINT — BNC Bancorp will acquire Mount Pleasant, S.C.-based Southcoast Financial for stock valued at about $95.5 million. Southcoast has 10 branches in the Charleston, S.C., area and $506 million in assets. BNC, parent company of Bank of North Carolina, has 57 offices in the Carolinas and Virginia and more than $5 billion in assets. The deal is expected to close in the first quarter of 2016.
HIGH POINT — vTv Therapeutics raised $117 million in an initial public offering. Formerly TransTech Pharma, the drugmaker started trading at $14 on July 30; the price declined to $10 by mid-August. vTv plans to use the proceeds to develop products including treatments for Alzheimer’s disease and Type 2 diabetes. It first filed for an IPO in 2014, but withdrew plans after receiving an investment from Boston-based Wellington Management.
LEXINGTON — Ken Bell, the receiver in the ZeekRewards federal securities-fraud case, distributed $89.2 million to victims of the Rex Ventures pyramid scheme that was based here and bilked 840,000 investors out of at least $850 million (cover story, June). Bell, an attorney with McGuireWoods in Charlotte, has paid out more than $246 million to victims since September. Another distribution is scheduled for Oct. 31.
