Motorola on the lookout for acquisitions

CHICAGO: Motorola Inc. will likely make acquisitions or form partnerships through some of its businesses once its semiconductor unit is spun off, a top strategy executive at the world's No. 2 cell-phone maker said on Monday.

"Each one of the businesses, and some more than others, have extension spaces that offer great growth opportunities," Leif Soderberg, senior vice president responsible for Motorola's global strategy, said on a telephone interview. "Simply spinning off the semiconductor business doesn't improve the performance metrics of the remaining Motorola."

He said the two-way radio and homeland security business, called the Commercial, Government and Industrial Systems unit, and the automotive electronics business, called the Integrated Electronics Systems unit, have strong growth prospects.

"Those (units) are clear businesses that have strong market positions," Soderberg said. "Partnerships and acquisitions are in all likelihood going to be an important part of the program."

However, Motorola is not looking at big deals, he said. The company recognizes it must "do things with other people, using other means, rather than simply all on our own, going forward in those two businesses," Soderberg said.

Software will be one area the company will concentrate on as it cuts across all its businesses, said Soderberg, whose comments were first reported on Monday in the Financial Times.

Motorola said that in October it planned to spin off its money-losing semiconductor unit to focus on its remaining businesses, including cell phones.

Executives have said the Chicago area-based company plans to register for an initial public offering of part of its chip business by the end of this year and complete the IPO at the end of the first quarter or the beginning of the second quarter next year.

The transaction could include 20 to 30 percent of the unit and will be followed by a spin-off of the remainder of the unit by the end of next year, the company previously said.

Reuters