US equipment vendor Motorola confirmed yesterday that it is to complete its long-expected separation on January 4, 2011.
In a statement, the company announced that the mobile handset branch of the business, Motorola Mobility, would be splitting from…
US equipment vendor Motorola confirmed yesterday that it is to complete its long-expected separation on January 4, 2011.
In a statement, the company announced that the mobile handset branch of the business, Motorola Mobility, would be splitting from Motorola, Inc, which would then be renamed Motorola Solutions.
Motorola said that the separation would be completed through a tax-free dividend that will involve the distribution of all Motorola Mobility common stock held by Motorola to its shareholders.
Motorola shareholders of record will receive one share of Motorola Mobility common stock for every eight shares of Motorola common stock that they hold.
This distribution will be completed before the market opens on January 4. After the distribution has finished, Motorola will carry out a 1-for-7 reverse stock split of Motorola common stock, which will become effective before the market opens on January 4.
The present co-CEOs of Motorola, Sanjay Jha and Greg Brown, will become the heads of the two separated companies, with Jha taking control of Motorola Mobility and Brown becoming CEO of Motorola Solutions.
Brown and Jha said that they believed the separation was in the best interests of shareholders, employees and customers. “We look forward to taking advantage of the opportunities before us as we begin the New Year as two independent, publicly traded companies,” they said.
The split comes after considerable pressure from activist shareholder Carl Icahn, who currently owns 11.2% of the company.