Motorola has moved a step closer to formal separation, filing an initial Form 10 Registration Statement with the US Securities and Exchange Commission (SEC). The move would facilitate any change of ownership at the mobile network infrastructure business,…
Motorola has moved a step closer to formal separation, filing an initial Form 10 Registration Statement with the US Securities and Exchange Commission (SEC). The move would facilitate any change of ownership at the mobile network infrastructure business, a perennial rumoured takeover target.
Once the process is complete, the current Motorola will become two distinct companies. Separating from the mother ship will be the mobile devices and home businesses, which together will be known as Motorola Mobility and headed by current co-CEO Sanjay Jha. The enterprise mobility solutions and networks businesses, meanwhile, will stay on board under a new name, Motorola Solutions. It will be headed by the other co-CEO, Greg Brown.
Earlier this month, Motorola told journalists it was open to a sale of, or a JV for, its mobile network infrastructure business. The unit, reportedly valued at some US$1bn-US$2bn, is usually mentioned as a target for Chinese rival Huawei. Huawei, which previously failed to buy US equipment group 3Com in 2005 due to fears over national security issues, last month appointed former US national security adviser John Bellinger as a consultant. This was seen as a direct appeal to convince Washington to allow future M&A activity as a means to grow the group’s presence in the US.
Sanjay Jha said the form represented the effort to create “two independent, publicly traded companies”. The troubled handset business made significant progress in 2010, he said, before adding that Motorola Mobility would be well positioned to benefit from convergence in the TMT sector.
Greg Brown, co-CEO of Motorola, said Motorola Solutions would also do well, with the enterprise mobility business focusing on public safety and enterprise mobility solutions, and networks providing technology leadership and solid operating performance.
David Dorman, chairman of Motorola’s board said, “We are very pleased with the significant financial and operational progress that Greg’s and Sanjay’s businesses have accomplished. Upon separation both businesses will be well capitalized and poised for stand-alone success.”
Motorola SpinCo Holdings Corporation (Motorola SpinCo), a new wholly owned subsidiary which filed the form, is the holding company for Motorola Mobility. Motorola stated that the separation should take place during the first quarter of 2011 through a distribution of shares in Motorola SpinCo to Motorola stockholders.
