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Motorola announced plans Thursday to split into two companies next year with one focusing on cellphones and home digital entertainment devices and the other on professional equipment such as two-way radios and public safety systems.
The Schaumburg, Illinois-based company, the biggest US handset maker, said it was targeting the first quarter of 2011 for the separation into publicly traded companies.
Motorola said one company would be made up of its Mobile Devices and Home businesses, which include cellphones and home digital entertainment devices such as television set-top boxes.
The other would comprise its Enterprise Mobility Solutions and Networks businesses, which include two-way radios, mobile computers, secure public safety systems, scanners and wireless network infrastructure.
Both companies will retain the Motorola brand.
Motorola said that effective immediately, Sanjay Jha, Motorola's co-chief executive, will serve as CEO of Motorola's Mobile Devices and Home businesses unit.
Greg Brown, Motorola's other co-chief executive, will head the Enterprise Mobility Solutions and Networks businesses, the company said.
Jha was hired by Motorola in 2008 to spin off its cellphone division from the rest of the company but the move was repeatedly delayed.
"The combination of Mobile Devices and our Home business brings together two highly complementary and innovative organizations," Jha said in a statement. "Together we will be best positioned to lead in the convergence of mobility, media, and the Internet.
"Our expanding portfolio of smartphones and end-to-end video content delivery capabilities will enable us to provide advanced mobile media solutions and multi-screen experiences for our customers," he said.
Motorola chairman David Dorman said the separation "provides significant operational and strategic flexibility for both companies, positions them for future success, and enhances long-term shareholder value."
Motorola shares were trading three percent higher at 6.86 dollars in after-hours electronic trading.
