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Hock Tan was feeling sensitive. As the most acquisitive executive in the chip industry, it was probably inevitable that his rapid-fire spate of deals — capped this week by a $130bn run at struggling Qualcomm — would bring charges of opportunism.
“I’m feeling pissed about that,” he said, when asked earlier this week about his public reputation. “We don’t pay bottom prices, we pay full prices.”
Mr Tan, chief executive of Broadcom, has never had to give much thought before to how he’s perceived. At 65, he has spent a career outside the public spotlight, building a reputation with a growing band of Wall Street supporters for his strong sense of timing and eye on operational efficiency. It is a modus operandi that has remained consistent — and successful — since he was recruited 12 years ago, when the company (then named Avago) was the subject of a buyout by Silver Lake and Kohlberg Kravis Roberts, the private equity firms.
But the unsolicited offer for Qualcomm, which would rank among the five biggest acquisitions ever, will take a different set of skills — and, as one ally of Mr Tan says, that will include working harder on his public image.
Mr Tan caught the financiers’ eye after turning round and selling Integrated Circuit Systems, a much smaller company. Moving to a company with five times the revenue — and then expanding that company’s sales more than tenfold, largely through acquisitions — has not changed his basic business philosophy.
One former Broadcom sums up Mr Tan’s approach this way: “Plane tickets, not advertisements.” He takes an axe to marketing and advertising spending at the companies he buys, and insists instead that executives spend their time visiting customers.
His small-business mentality also shows through in a strong distaste for the kind of pet projects that can lead other chief executives astray and sap the strength of even the biggest companies. Since buying the larger Broadcom and adopting that company’s name, he has ended projects to develop chips for things such as autonomous cars and servers.
“Where do you put your big bets, and remove your small bets?” says Ken Hao, a partner with Silver Lake and Broadcom board member. “Small companies are good at that, big ones aren’t. It’s a mentality that he’s retained.”
Mr Tan has not followed the usual path to the top echelons of corporate America. He came to the US from his native Malaysia to take up a scholarship at the Massachusetts Institute of Technology. Degrees in mechanical engineering and an MBA at Harvard followed, before a move into finance positions at PepsiCo and General Motors.
I would compare his raw IQ and horsepower against any business executive I’ve ever met
The strong finance leaning has helped in his debt-fuelled rise. “He’s not a chip guy, he’s a dollar guy,” says the former Broadcom executive. “Investors love him because he pays off loans fast.”
Supporters credit him with a clear-eyed view of his company’s fundamental business. “He never tried to copy anyone, he starts with first principles reasoning,” says Mr Hao. “I would compare his raw IQ and horsepower against any business executive I’ve ever met.” He also describes him as “an extreme workaholic”.
These days, Mr Tan splits his time between Silicon Valley and Philadelphia, where two of his three adult children live. Along with wife Lisa Yang, he has made multimillion-dollar donations to MIT and Cornell University for research into autism — a condition that affects two of his children.
Mr Tan may have flown under the radar up to now but all that is about to change given the sheer scale and audacity of the Qualcomm bid. Winning over regulators, shareholders, customers and Qualcomm’s board will involve political skills he has not needed previously.
He gave his public persona a rare outing last week in an event at the Oval Office, handing a political gift to President Trump by promising to shift his company’s legal base from Singapore to the US, from where it is already in effect run. It was his first time at the White House, as well as the first time meeting the president, he said afterwards.
Given what lies ahead, it was not a bad place to start.
This post originally appeared on Financial Times