Motorola to sell, spin-off largest division?

In a new, unofficial strategy, Motorola is planning on splitting the largest of its three divisions, according to sources in a Wednesday report. The company reportedly hopes to auction off its wireless networking business while spinning off set-top boxes and mobile handsets into a new, publicly-traded company. If the company goes through with the plan, the final Motorola would be a third the size of the current company, leaving behind just a small radio and barcode manufacturer.

The WSJ insiders said second-round bidding, which includes management presentations for the network arm that makes cellphone tower equipment and other related gear, would begin soon. This division makes about $4 billion in annual sales.

Motorola has been considering spinning off the handset unit for a long time, but doing so for both it and the home entertainment hardware unit will be even more complicated. In 2009, the cellphone division generated about $7 billion in sales revenue, while set-top box sales accounted for nearly $4 billion in sales.

Huawei is purportedly interested in Motorola's networking business, which may be sold for $1 billion by itself or more if sold with other parts, say the informants.

Motorola has not released any official statements regarding these rumors, but a statement late in January from Motorola co-Chief Executive Officer Greg Brown said that the company is moving "full steam ahead" on the split without specifically revealing any changes in plan. Some rumors had Motorola reconsidering the separation after strong Droid sales raised the possibility that the mobile group could become profitable again and boost Motorola's bottom line.

By Electronista Staff