News

Motorola Goes Back to Splitsville

2/13/2010 12:00 AM Eastern

Motorola announced a revised plan to break itself up, and this time the company thinks there are synergies possible between its cable set-top and mobile-phone devices groups.

The company is aiming to split into two separate companies by the first quarter of 2011: one that will merge mobile devices and the cable-oriented Home business, and the other comprising its wireless-networking and enterprise units.

The new plan, announced last week, will create two independent, publicly-traded entities. The strategy comes after Schaumburg, Ill.-based Motorola reportedly had been attempting to sell the Home & Networks Mobility unit. Two years ago, Motorola said it would spin off the handset business, but that never came to pass as that group’s sales plummeted.

Sanjay Jha, currently co-CEO of Motorola heading up the Mobile Devices division, will serve as CEO of Motorola’s Mobile Devices and Home businesses effective immediately. The newly reorganized Mobile Devices and Home business will offer mobile converged devices, digital set-top boxes, and video, voice and data solutions.

“The combination of Mobile Devices and our Home business brings together two highly complementary and innovative organizations,” Jha said in a statement. “Together, we will be best positioned to lead in the convergence of mobility, media and the Internet.”

Greg Brown, Motorola’s other co-CEO, will become CEO of the Enterprise Mobility Solutions and Networks business effective immediately. That business combines Motorola’s two-way radios, mobile computers, secure public safety systems, scanning, RFID and wireless network-infrastructure businesses.

According to Motorola, the Enterprise Mobility Solutions and Networks company will assume the current company’s outstanding debt, which is expected to be approximately $3.3 billion at the time of the separation next year.

With the reorganization Dan Moloney, currently president of the Horsham, Pa.-based Home & Networks Mobility group, will go back to running the Home division and will report to Jha. Motorola created the group in 2007, explaining at the time that it was trying to better cater to service-provider customers.

Following the split, both entities will use the Motorola brand. The Mobile Devices and Home business is expected to own the Motorola brand and license it, royalty-free, to the Enterprise Mobility Solutions and Networks business.

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