Posted on Wednesday, March 26 2008 @ 20:55 CET by Thomas De Maesschalck
Motorola announced today that it will split its business into a Mobile Devices devision and Broadband & Mobility unit:
The moves comes as the Schaumburg, Illinois, company has come under pressure from billionaire investor Carl Icahn to take steps to boost shareholder value.
The move will split its Mobile Devices division, which has been lagging in the market for handsets and other mobile phones, and its Broadband & Mobility unit, which makes wireless modems, TV set-top boxes and other equipment.
"Creating two industry-leading companies will provide improved flexibility, more tailored capital structures, and increased management focus -- as well as more targeted investment opportunities for our shareholders," Motorola chief executive and president Greg Brown said in a statement.
The separation is expected to take the form of a tax-free distribution to Motorola's shareholders, who would then own shares of two independent groups, Motorola said.
The company had announced on January 31 that it was studying a possible breakup in an effort "to recapture global market leadership" in the mobile phone market and enhance shareholder value.
Motorola, once the world's second-largest mobile phone maker, after Nokia Corp. of Finland, has since lost its place to South Korean rival Samsung Electronics Corp. amid fierce global competition and watched its earnings slide.
Source: AP
