Filed under: Deals, Bad news, Industry, Competitive strategy, Motorola (MOT), Nokia Corp. (NOK)
Part of Motorola’s (NYSE:MOT) strategy in spinning off its weak handset unit is the hope of finding buyer. The business lost over $1 billion last year on revenue of $19 billion. This year, with unit sales still dropping, those numbers will get worse.
So far, no one has stepped up with an offer. Firms like Nokia (NYSE:NOK), Samsung, and Sony Ericsson may be better off watching the US handset maker bleed to death. That takes away much of the incentive of being a buyer.
Yesterday, China’s Huawei Technologies, a big handset maker in the massive Asian country, stated it had no interest in Motorola. According to Reuters, “Huawei stated it wasn’t interested in buying the business as it is focused on selling its phones under the brand of its mobile operator customers, while Motorola sells phones to consumers under its own brand.”
At $9.47, Motorola still trades near a 52-week low, despite plans to break the company into two pieces. That gives the company a market cap of $21 billion. The firm’s home mobility and enterprise systems divisions are profitable. That means the the handset division is worth very little.
Motorola can’t even give it away.
Douglas A. McIntyre is an editor at 247wallst.com.
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