Motorola disclosed late Thursday that it is exploring a "strategic realignment" that might include the divestiture of its troubled cellular-phone...

Share story

CHICAGO — Motorola disclosed late Thursday that it is exploring a “strategic realignment” that might include the divestiture of its troubled cellular-phone business.

Immediately after the announcement, one of Motorola’s fiercest critics, billionaire investor Carl Icahn, released a statement applauding the decision. Icahn, who owns 2.9 percent of Motorola’s shares, also disclosed that he had “previously informed” Motorola that he plans to have his own slate of directors seek election to the company’s board at Motorola’s annual meeting in the spring.

With Icahn having previously campaigned to see the company broken up, his re-emergence Thursday raised the question of his influence in Motorola’s decision to look at options.

Motorola shares were pounded recently, after the company reported fourth-quarter results battered by the continuing loss of market share in cellphones. Once riding high on the success of its striking Razr, Motorola’s handset business has had difficulty finding a follow-up hit — and its rivals have moved in to take a growing share of the global market.

Motorola’s cellphone problems renewed speculation that the company might exit the volatile handset business and concentrate on its remaining, less-volatile communications-equipment operations. This week, Nomura analyst Richard Windsor raised that possibility and noted that rumors of a Chinese buyer for Motorola’s handset business have revived.

After the market had closed Thursday, Motorola announced it is exploring a “structural and strategic realignment” that would better equip the handset group to recapture global-market share and “enhance shareholder value.”

Alternatives under consideration, Motorola said, include the separation of the mobile-devices business from the company’s other operations, “in order to permit each business to grow and better serve its customers.”

President and Chief Executive Greg Brown said the company is looking for a way to let the handset group “accelerate its recovery and retain and attract talent while enabling our shareholders to realize the value of this great franchise.”

Motorola didn’t elaborate and said it won’t discuss developments regarding the potential shake-up unless a transaction is in hand. It also offered a standard caution that there is no certainty a transaction will occur.