SCHEDULE 13D: Starboard Value Discloses 7.7% Activist Stake in Qorvo, Citing Undervaluation

Activist investor Starboard Value LP and its affiliates have disclosed a 7.7% beneficial ownership stake in Qorvo, Inc., stating their belief that the shares are undervalued and represent an attractive investment opportunity.

Summary

• Starboard Value LP and its affiliated entities, including Starboard V&O Fund, Starboard S LLC, Starboard C LP, Starboard L Master, Starboard X Master, and the Starboard Value LP Account, collectively beneficially own 7,285,655 shares of Qorvo, Inc. Common Stock.
• This aggregate ownership represents approximately 7.7% of Qorvo's outstanding shares, based on 94,526,698 shares outstanding as of October 23, 2024.
• The beneficial ownership includes 2,502,416 shares underlying certain forward purchase contracts (507,186 shares with Bank of America and 1,995,230 shares with Morgan Stanley) that are exercisable within 60 days.
• The Reporting Persons acquired these shares with working capital, with total aggregate purchase prices for their holdings amounting to approximately $274,157,947 for Starboard V&O Fund, $37,272,733 for Starboard S LLC, $29,189,452 for Starboard C LP, $14,477,386 for Starboard L Master, $98,193,369 for Starboard X Master, and $63,434,936 for the Starboard Value LP Account.
• Starboard's investment is driven by their belief that Qorvo's shares were undervalued at the time of purchase and represent an attractive investment opportunity.
• The Reporting Persons intend to review their investment on an ongoing basis and may engage with Qorvo's management and Board of Directors to propose changes.

Sentiment

Score: 7

Explanation: The sentiment is positive from the activist investor's perspective, as they believe the shares are undervalued and represent an attractive investment opportunity, indicating an expectation of future value creation through engagement.

Positives

• Starboard Value LP believes Qorvo's shares are undervalued, indicating potential for price appreciation.
• The activist investor intends to engage with Qorvo's management and Board to enhance shareholder value, potentially leading to strategic improvements.
• Starboard may propose changes to capitalization, ownership structure, board composition, or suggest business combinations/dispositions to improve financial and operational performance.

Risks

• Starboard Value LP may increase or decrease its position in Qorvo, including through sales, short selling, or hedging transactions, which could impact share price volatility.
• The Reporting Persons may propose significant changes to Qorvo's corporate structure or operations, which could lead to management distraction or operational disruption.
• There is an ongoing dispute regarding the validity of the indirect transfer of Cowen Inc.'s ownership interest in Starboard Value to Toronto Dominion Bank, though the Reporting Persons disclaim a 'group' with TD.

Future Outlook

The Reporting Persons intend to continuously review their investment in Qorvo, Inc. They may take various actions, including engaging in communications with Qorvo's management and Board, discussing with other stockholders, and making recommendations concerning changes to Qorvo's capitalization, ownership structure, board composition, potential business combinations or dispositions, or suggestions for improving financial and/or operational performance. They also reserve the right to purchase additional shares, sell existing shares, or engage in hedging transactions.

Industry Context

This filing indicates an activist investment in Qorvo, Inc., a company operating in the semiconductor industry. Such investments often signal that a significant shareholder believes the company is underperforming relative to its potential or industry peers and seeks to drive strategic or operational changes to unlock value. The specific implications for broader industry trends are not detailed in this ownership disclosure.

Corporate Governance

Legal Proceedings

• An ongoing dispute exists regarding the validity of the indirect transfer of Cowen Inc.'s ownership interest in Starboard Value as a result of the acquisition of Cowen Inc. by Toronto Dominion Bank.

Stakeholder Impact

• Shareholders: Potential for increased shareholder value if Starboard's engagement leads to improved financial and operational performance or strategic transactions. Conversely, potential for volatility if Starboard significantly alters its position.
• Management and Board: Increased scrutiny and potential pressure to implement strategic or operational changes proposed by Starboard.

Next Steps

• Starboard Value LP and its affiliates will continue to review their investment in Qorvo, Inc.
• They may engage in communications with Qorvo's management and Board of Directors.
• They may engage in discussions with other stockholders or third parties about Qorvo and their investment.
• They may make recommendations or proposals to Qorvo concerning changes to capitalization, ownership structure, board structure (including composition), potential business combinations or dispositions.
• They may suggest improvements for Qorvo's financial and/or operational performance.
• They may purchase additional shares, sell some or all of their shares, or engage in short selling or hedging transactions.

Key Dates

Keywords

Qorvo, Starboard Value, Activist Investor, Schedule 13D, Common Stock, Shareholder Value, Corporate Governance, Undervalued, Investment Opportunity, Forward Contracts, Semiconductor