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Motorola Mobility to Lose Debt, Break Away with Lumps of Cash


Posted on June 18th, by Evan Selleck in archive. No Comments

Motorola’s going through some changes. We already know that the section that’s in charge of the mobile division, the same one that created the Motorola RAZR and Motorola DROID, is going to split away from the parent company, as well as Motorola’s set-top box unit. Motorola Solutions is getting the same deal as Motorola Mobility, but obviously you’ll understand why we’re focusing on one, and not the other.

According to The Wall Street Journal, it looks like Motorola is set to make sure that Mobility has the best chance it can to creating top-notch devices, and therefore actually earning some money. While the DROID was, and still is, a huge success, it’s really all the company has received since the death of the RAZR all those years back. Now that the Droid X and Droid 2 are releasing in a matter of weeks, Motorola’s still banking on Android to pull them from the rut they’ve found themselves in.

The WSJ is reporting that, when the split happens, Mobility will be stricken from Motorola’s mothership debt, as the company as a whole is currently undergoing a massive debt buyback. When all of that’s complete, and Mobility is freely on its own, the parent company is going to cut them a check for upwards of $4 billion, which should give them plenty of wriggle room to get the job done. With leverage, Motorola is hoping that Mobility can come out on top again, and propel Motorola back into the lime light of the mobile phone market.

[via The Wall Street Journal]