A gift and a curse

Motorola is separating its handset business from its other operations, converting one turmoil-ridden firm into two publicly-traded companies.

The move is also expected to be tax-free, enabling shareholders to own stock in both companies.

"The creation of the two independent publicly traded companies provides improved management focus and a capital structure that's more tailored to the individual business needs," said CEO Greg Brown.

Unable to reproduce the success of the Razr, Motorola's mobile phone unit has struggled with low sales and a condemning stock price. Following its demotion to third place in 2007 handset sales (behind Samsung and Nokia), the company said it would explore a "structural and strategic realignment."

According to Wired, Motorola's handset business will operate separately from its combined home and networks business, which vends set-top boxes and modems. Motorola also sells computing and communications tools to enterprise customers.

The units will be separated in '09, pending approval of the deal.