Tech Search

Moto's composed of a number of fairly distinct divisions that produce vastly different kinds of hardware for different industries; some are cash cows, others -- namely the handset and set-top box units -- aren't. It looks like the company is preparing a pretty radical plan for its upcoming split that would call those underperforming divisions to get most of the cash reserves and a... lmost none of its debt. Actually, neither Motorola Mobility nor Motorola Solutions (as they'll likely be known) will see much of the combined company's current debt load, as they're currently undertaking a massive debt buyback; afterward, Mobility will allegedly be cut a check for somewhere between $3 and $4 billion to go about its high-stakes business in the ultra-competitive smartphone game. The idea is to position both post-split companies with as much leverage as possible for acquisitions and low-cost borrowing. Solutions shouldn't have a problem, as its businesses already generate the overwhelming majority of Moto's cash -- but for Mobility, this should give the lil' sprout the best chance it has for survival.

Motorola's split plan calls for a debt-free, cash-heavy mobile unit originally appeared on Engadget on Fri, 18 Jun 2010 14:55:00 EDT. Please see our terms for use of feeds.

Permalink   |  The Wall Street Journal  | Email this | Comments

< Prev		Next >