According to reports from
The Wall Street Journal, Motorola (News - Alert) “has
put the auction of its biggest business unit on hold as the company reconsiders its latest breakup plan.”
The
Journal cites “lower-than-expected bids for the company’s home and networks mobility division, which had 2008 sales of $10.1 billion,” as considerations affecting the kibosh. Sources told the Journal that Motorola had hoped the division would get about $4 billion to $5 billion, but that actual bids have been a bit lighter.
The
Chicago Tribune reported that the company’s “plan of record is to
separate its mobile handset division from the other two businesses, Home and Networks Mobility and Enterprise Mobility.”
The Journal reports that Motorola’s sales in the third quarter fell 27 per cent from a year earlier to $5.5 billion, and its earnings were just $12 million.
In the third quarter of 2008, according to the Trib, “Motorola reported $19 million in separation-related charges after not having incurred any such costs in the first half of the year, suggesting that the breakup plan was in motion. Yet recent news reports have said Motorola was entertaining bids from strategic buyers and private-equity firms for the home and networks division.”
Motorola kicked around the idea of the sale of the unit last November, in what the Journal at the time called “the latest sign of the once-mighty technology giant’s declining ambition in the convulsive world of telecommunications.” The company’s been in a nagging sales funk recently, and hasn’t really had a hit product since the Razr a couple years ago. Even then it ran into a thicket spinning off its handset business.
Matt Thornton, an analyst at Avian Securities, told the Trib, in the Trib’s words, that “bids may have come in too low because Motorola prohibited joint bids in the first round. If that’s the case, the company could restart the auction allowing buyers to team up.”
The next round of bids is scheduled for mid-February, but with Motorola’s board and management meeting in the next week or two to decide what’s what, that could change.
To find out more about Motorola, visit the company at the M2M Evolution Conference. To be held Jan. 20 in Miami and collocated with ITEXPO East 2010, the M2M Evolution Conference will focus on how telemetry has been changing to take advantage of the Internet, where WAN and LAN systems were points of aggregation in the past today’s machines benefit from the ability to connect worldwide. And as the machines continue to look to network the wireless world represents a large growth opportunity for data communication. Alex Shneyderman is speaking during “The Machines are Talking” on Jan. 20. Don’t wait. Register now.
David Sims is a contributing editor for TMCnet. To read more of David’s articles, please visit his columnist page. He also blogs for TMCnet here.
Edited by Erin Harrison