Motorola mulls restructuring; may split operations
01 Feb 2008
Third-largest mobile handsets manufacturer behind Nokia and Samsung, Motorola Inc says it is exploring a "structural and strategic realignment" of its businesses to better equip its mobile devices business to recapture global market leadership and to enhance shareholder value.
The company says it is exploring options including the separation of its mobile devices from its other businesses in order to permit each business to "grow and better serve its customers".
The company said that it would not discuss further developments unless or until its board of directors has approved a definitive transaction or the process is otherwise complete. There can be no assurance that any transaction will occur or, if one is undertaken, its terms or timing.
"We are exploring ways in which our mobile devices business can accelerate its recovery and retain and attract talent while enabling our shareholders to realize the value of this great franchise, said Greg Brown, president and chief executive officer."
Earlier this month activist investors Carl Icahn, who has a 2.9-per cent stake in Motorola, eyeing a seat on its board, had lashed out against the company last year through a full page advertisement in the Wall Street Journal for "stumbling badly", a charge rejected by Motorola.
In a response to Motorola's announcement on the proposed restructuring, Icahn said he had been publicly advocating the separation of mobile devices from Motorola's other business and "I am pleased to see that Motorola is finally exploring that proposal".
Icahn said "W believe Motorola is finally moving in the right direction but certainly still has a long way to go." He, however, emphasised the announcement by Motorola would not detract from his to run a slate for directorships on the board.
A Fortune 100 company with global presence Motorola had sales of $36.6 billion in 2007.
