Motorola to split into two

Nicole McCormick
12 Feb 2010
00:00

Motorola has announced plans to spin off two separate publicly-traded companies by early 2011.

Under the restructuring, the US electronics firm will combine its mobile devices and home settop box divisions into one company.

It will fold its enterprise mobile and networks businesses into a second new firm.

Current co-CEOs Sanjay Jha and Greg Brown will each head one of the new divisions. Jha will take full control of the mobile devices and home business effective immediately.

The announcement follows a series of other efforts by the firm to cope with the dramatic falloff in sales at its flagship handset unit.

It first planned to spin off the device unit, but put that on ice when the global recession hit in October 2008.

Last year it tried to sell its home and networks businesses for $4.5 billion, but the sale stalled because of a lack of buyers.

Motorola said it hoped that combining its consumer-focused set-top and mobile devices arms into one would allow it to be the “best positioned to lead in the convergence of mobility, media, and the internet.”

“This business will offer a comprehensive portfolio of mobile converged devices, digital entertainment devices in the home, and end-to-end video, voice and data solutions,” said Jha.

The enterprise mobility and networks business aimed to “offer a comprehensive end-to-end portfolio of products and solutions, including rugged two-way radios, mobile computers, secure public safety systems, scanning, RFID, and wireless network infrastructure.”

The separation will take place through a tax-free stock dividend of shares in the new companies to existing shareholders.

Both companies will be “well capitalized” and use the Motorola brand following the separation, the vendor said.

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