Motorola on Tuesday confirmed more details about how it plans to split into two companies early next year, including that the split will go into effect on Jan. 4.
As previously described in an SEC filing in July, the current Motorola will be divided into two separate companies: Motorola Mobility Holdings, which will cover Motorola's set-top boxes, cable equipment and home business and also its handsets and mobile devices, and Motorola Solutions -- where much of the company's channel business is concerned -- for its networks and enterprise mobility divisions.
Following the split, Motorola Solutions will trade on the New York Stock Exchange using the symbol "MSI," and Motorola Mobility will use the symbol "MMI."
"We look forward to taking advantage of the opportunities before us as we begin the new year as two independent, publicly traded companies," said Motorola co-CEOs Greg Brown and Sanjay Jha in a statement. Following the split, Brown will be CEO of Motorola Solutions, and Jha of Motorola Mobility.
Motorola said that its board of directors approved Motorola Mobility's separation from Motorola Solutions via a stock distribution. Before close of business on Dec. 21, Motorola stockholders will receive 1 share of Motorola Mobility common stock for every 8 shares of Motorola common stock they currently hold, and immediately following that distribution, Motorola will effect a 1-for-7 reverse stock split of Motorola common stock.
Motorola on Oct. 28 reported a third quarter sales increase, marking the company's first quarter of profitability and annual revenue growth since 2006. It reported revenues of $US5.8 billion, up 6 percent year over year, and $US109 million in earnings on 5 cents per share. Its mobile device sales were about $US2 billion for the quarter, up 20 percent year-over-year, and Motorola said it had shipped 9.1 million handsets and 3.8 million smartphones.
At the time, the company has seen continued momentum behind its major smartphone releases, especially its flagship Droid X, and has touted its phone gains on last year's decision to align itself with Google's Android mobile OS for smartphone development. Motorola's Droid X and Droid 2 are both part of an expanding lineup of Android-based devices fueling the Android platform's rapid growth this year.