Motorola will finally split into two separate public companies next year on January 4, a move first announced in 2008.
The company said yesterday that its board has approved the separation of Motorola Mobility Holdings from Motorola. The new Motorola Mobility company will handle the mobile phone and set-top box business. Motorola will rename itself to Motorola Solutions and focus on the enterprise and network business products.
Sanjay Jha will run Motorola Mobility as CEO, while Greg Brown will assume the same role for Motorola Solutions. Both men have been running Motorola as co-CEOs.
Stockholders who own Motorola shares by the close of business on December 21 will receive stock in the two companies. Motorola stockholders will get one share of Motorola Mobility common stock for every eight shares of Motorola common stock that they own. Motorola will then carry out a 1-for-7 reverse stock split of all Motorola common stock, effective before the market opens on January 4. That means every seven shares of Motorola common stock will be converted into one share of Motorola Solutions common stock.
Starting January 4, Motorola Solutions will trade on the New York Stock Exchange under the ticker symbol MSI, while Motorola Mobility Holdings will begin trading on the NYSE under the symbol MMI. Motorola stockholders can find more information about the split and its effects on their shares at Motorola's investor page.
The company first revealed its decision to separate back in March 2008 in light of its weak financials and pressure from investors. That move was supposed to occur in the third quarter of 2009, but the sour economy and Motorola's ongoing losses in 2008 and 2009 delayed the separation. Since then, though, Motorola has enjoyed a turnaround in profitability, thanks in huge part to the success of its Android phones.
"Today's announcement marks another important milestone toward the upcoming separation that is expected to benefit Motorola, its stockholders, as well as each company's respective customers and employees," Brown and Jha said in a joint statement. "We look forward to taking advantage of the opportunities before us as we begin the new year as two independent, publicly traded companies."
In line with the separation, Brown will be elected chairman of the board for Motorola Solutions. The new company's board will also nominate David Dorman as a non-executive chairman. Dorman is currently serving the same role for Motorola. Other members of the board will include William Bratton, Michael Hayden, Vincent Intrieri, Judy Lewent, Samuel Scott III, Douglas Warner III, and John White.