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Motorola Commences Process
to Create Two Independent Companies
March 26, 2008
Motorola, Inc. has commenced a process to create
two independent, publicly-traded companies. The
decision follows the Company’s January 31, 2008
announced evaluation of the structural and
strategic realignment of its businesses and
represents affirmative steps to position its
Mobile Devices and Broadband & Mobility
Solutions businesses for success, while creating
value for all Motorola shareholders.
“Our decision to separate our Mobile Devices and
Broadband & Mobility Solutions businesses
follows a review process undertaken by our
management team and Board of Directors, together
with independent advisors,” said Greg Brown,
Motorola’s president and chief executive
officer. “Creating two industry-leading
companies will provide improved flexibility,
more tailored capital structures, and increased
management focus – as well as more targeted
investment opportunities for our shareholders.”
Based on current plans, the creation of the two
stand-alone businesses is expected to take the
form of a tax-free distribution to Motorola’s
shareholders, subject to further financial, tax
and legal analysis, resulting in shareholders
holding shares of two independent and
publicly-traded companies:
- The Mobile Devices business is an industry
leader in multi-mode, multi-band communications
products and technologies. The business designs,
manufactures and sells mobile handsets and
accessories globally with integrated software
solutions that incorporate the latest personal
communications technologies. It also licenses a
portfolio of intellectual property.
- The Broadband & Mobility Solutions business
includes Motorola’s Enterprise Mobility,
Government and Public Safety, and Home and
Networks businesses. These businesses
manufacture, design, integrate, and service
voice and data communication solutions and
wireless broadband networks for enterprises and
government and public safety customers
worldwide. These businesses also provide
end-to-end digital and Internet Protocol (IP)
video solutions, cellular and high speed
broadband network infrastructure, cable set-top
receivers, and associated customer premise
equipment for residential and commercial
wireless network system access.
“Our priorities have not changed with today’s
announcement,” added Brown. “We remain committed
to improving the performance of our Mobile
Devices business by delivering compelling
products that meet the needs of customers and
consumers around the world. As part of that
effort, we have undertaken a global search for a
new chief executive officer for the Mobile
Devices business. We believe strongly in our
brand, our people and our intellectual property,
and expect that the Mobile Devices business will
be well-positioned to regain market leadership
as a focused, independent company.”
The completion of any separation transaction
would be subject to certain customary
conditions, including implementation of
inter-company agreements, filing of required
documents with the Securities and Exchange
Commission and receipt of an opinion of counsel
or a ruling from the Internal Revenue Service as
to the tax-free nature of any transaction. The
Company expects that the separation of its
businesses, if consummated, would take place in
2009. The Company noted that there can be no
assurance that any separation transaction will
ultimately occur or, if one does occur, its
terms or timing.
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