Motorola poised to offload mobile biz

Sell it or spin it off?


Motorola is considering various options to sort out its mobile phone division which lost the company $1.2bn in 2007.

The company has gone from decent performance in the handset field, most recently with its RAZR phones, to just over 12 per cent market share by the end of last year. In the fourth quarter of 2007 Motorola sold 40.9m handsets against Nokia's 133.5m.

In a statement the company said it was considering "structural and strategic realignment of its business" in order to sort out its mobile devices division. Motorola said separating the mobile business might be the best way to get it to grow.

The handset maker said it would not discuss alternatives until after the board of directors has made a decision.

The decision could be seen as a victory for activist shareholder Carl Icahn who spent last year campaigning for the company to be split.

But it will also be another painful upheaval for Motorola, which parted company with CEO Ed Zander in November, after three years.

So who would buy a loss-making mobile maker?

One possibility is Samsung which has long fought with Motorola for the number two spot - Samsung had 14 per cent of the market and shipped 46.4m phones in the last quarter of 2007.

Then again, taking on someone else's mobile business his no surefire guarantee of success, as BenQ's takeover of Siemens' mobile business demonstrated when it ended in acrimony in 2006. ®

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