Motorola to sell Connected Home Division
November 13, 2009
Motorola is to sell its Connected Home Division, including the world's biggest STB business, according to the NY Times.
The newspapers says sources at Goldman Sachs and JP Morgan, hired to advise on strategic options, are now recommending a three-way split with networks being sold off and the remaining company separated between the mobile phone and two-way radio businesses. It had previously been envisaged only the handset business would be spun off separately. The connected home division is already being marketed.
An analyst for Macquarie Capital is quoted as saying the unit, that produced $199m profit last quarter (to September), could be valued at up to $5bn. The unit's revenue fell 15 percent, to $2 billion last year. Motorola currently has $4bn debt and its handset unit has slipped badly in market share and is now relying on its Droid smart phones to turn things around.
Motorola got into the cable STB business in 2000 when it acquired General Instrument for $17 billion.