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Old 03-27-2008, 08:41 AM
 
Location: Tennessee/Michigan
27,998 posts, read 46,408,665 times
Reputation: 19403

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CHICAGO — Motorola Inc. bowed to pressure from investors today, announcing a plan to split its struggling cellphone business from other operations to form two separate publicly traded companies.

The widely expected deal comes as the suburban Chicago cellphone maker faces a second straight year of agitation from billionaire investor Carl Icahn, who has become increasingly frustrated with Motorola's eroding phone sales.

Motorola to split into two separate companies (broken link)
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Old 03-27-2008, 08:50 AM
 
5,640 posts, read 16,944,474 times
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First of all, I don't trust Carl Icahn's motives... he is a corporate raider. I suspect he is looking to break up motorola and sell off the pieces.

Second, I think it is good that they spin off handsets because that sector has been dragging down the performance of that entire company for the last 2-3 years now. The stock flippers only would reward the performance of the handset division, while the other part of the business, which was the bread and butter of the operation, was continually making their goals and $$. I know the employees of the other divisions have to be happy about this. 2-way radios, networking, etc. They've been bustin' their tails.

I do think they can turn around their handset unit too. As long as they don't hire another Zander. He devalued the company by selling off units. Which increase the stock market price short term, but eventually devalued the company as a whole.

Moto's strength has historically been in R&D. In the new business climate, all the big corps do is just buy the innovation (i.e. smaller companies). They should get back to that. And get back to making moto a good place to work - i.e. getting talent to want to work there again. It used to be that way.
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Old 03-27-2008, 09:40 AM
 
Location: Tennessee/Michigan
27,998 posts, read 46,408,665 times
Reputation: 19403
I'm wondering if it's good idea to own Motorola stock or not?


John
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Old 03-27-2008, 10:36 AM
 
5,640 posts, read 16,944,474 times
Reputation: 3963
Well - it is low right now. If you buy, it will be bottom feeding. Luckily, we sold a lot of it when it hit $26 a share.
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