Icahn: Dump the Handset Unit
Ed Zander's resignation as CEO last year did little to please Ichan, who said in a December statement, "In my opinion, Motorola should be split into separate companies: a mobile devices company; an enterprise mobility company; a connected home company; and a company focused on mobile networks infrastructure." Motorola announced in February that it was "exploring ways in which our Mobile Devices Business can accelerate its recovery and retain and attract talent while enabling our shareholders to realize the value of a great franchise.""For many months I have been publicly advocating the separation of Mobile Devices from Motorola's other business and I am pleased to see that Motorola is finally exploring that proposal," Icahn said in a statement in February. "However, we have previously informed Motorola that we expect to run a slate of directors for the upcoming annual meeting and this announcement by Motorola will not deter us from that effort." Icahn said the company "is finally moving in the right direction, but certainly still has a long way to go." All the publicity generated by Motorola's handset travails has overshadowed better news from the company's other two major divisions: the home and networking segment and the enterprise mobility unit. Featuring television set-top boxes and modems, the home and networking unit increased sales by 11 percent to $2.7 billion. Operating earnings, though, fell 14 percent to $192 million. The enterprise mobility solutions division saw a 40 percent increase in operating earnings of $451 million on sales of $2.1 billion, largely on the strength of acquiring Symbol Technologies in 2007.
Icahn has preached for months that Motorola needs to dump its handset unit.