Motorola Spins Off Mobile Division – Goodbye HelloMoto!

Previous rumor about Motorola spinning off its mobile division is finally confirmed. Just recently, the board of directors has made decision to spin off the mobile division, aiming to offload the whole corporate company from bad financial situation due to stiff competition in mobile market segment. This is also an effort initiated by Carl iCahn, an activist investor who has influenced and pressurized the boards’ final decision to sell off this division. By then, Motorola will consist of two totally independent entities, leaving Broadband and Mobility Solution as a centric business core focusing on public, government safety equipment, wireless infrastructure and set-top boxes.

If you recall, Motorola was used to be the leading manufacturer in mobile industry. However, its market share has been eaten by other competitors such as Nokia, Samsung, Sony Ericsson, making it hard to survive in this fast moving industry. The situation didn’t improve much even after the launch of its famous Razr mobile phone and few follow-on models to consumer market.
The whole transaction is claimed to be completed by 2009. Throughout these 18 months timeframe, Greg Brown, Motorola CEO is still committed to deliver compelling mobile products that fits consumer demand. The share market reacted positively with the price share up by 6 percent to $10.34 immediately after the annoucement.