Motorola Does Not Rule out Break-up of Company
Here's an interesting story from Reuters, covering my favorite member of the Motorola Management team (and Board): Tom Meredith. Tom's all business and is credible. He says he doesn't rule out a break-up of the company.
Interesting. Here was his reaction back on July 19th when people speculated that Ed Zander was going to be replaced. "The board is not actively looking for a new CEO.... The (BusinessWeek) story is incorrect. Our board believes we have the right strategy and the right team in place." It turns out that -- less than a week later -- the Board elevated Greg Brown to join the Board himself (on July 25th), which now in hindsight clearly shows that the Board had already decided to make the change at the top but wanted to give Brown a little more seasoning.
Of course, I still like Meredith -- and I still think he's credible. However, given this earlier statement and fact, I would say that the message of today's comment is: "We're open to offers. Step right up!" As I've said elsewhere, that's smart -- given where the company is now and where it needs to get to....
NEW YORK, Dec 6 (Reuters) - Motorola Inc (MOT.N: Quote, Profile , Research) Chief Financial Officer Tom Meredith did not rule out a break-up of the company as he affirmed the phone maker's earnings guidance for the fourth quarter on Thursday.
Asked about a recent call by activist investor Carl Icahn for Motorola to break into several units, Meredith would not rule out structural changes to the company, which has been losing market share to rivals due to a weak phone line-up.
"I believe there's every opportunity for us to create significant economic value as a whole. Does that mean other options aren't viable? Not at all," Meredith told an investor conference Webcast.
Meredith backed Motorola's forecast for fourth-quarter earnings per share from continuing operations of 12 cents to 14 cents per share. He said Motorola's mobile device unit would see sequential revenue and bottom-line improvements. (Reporting by Sinead Carew, editing by Dave Zimmerman)
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