Motorola To Spin Off Chip Business

Communications company Motorola, a co-developer and manufacturer of the PowerPC architecture, will spin off its microprocessor unit into a separate, publicly traded company, it said Monday.

In spinning off its $4.8 billion chip division, the Schaumburg, Ill.-based company will focus anew on its communications and integrated electronics businesses while attempting to maximize the value of its Semiconductor Processor Sector, it said in a statement.

"Over the past several months, we have carefully weighed the best way to optimize the long-term potential of Motorola's semiconductor business with the leverage we would gain by concentrating our resources on our communications products and integrated electronic systems businesses," Motorola CEO Christopher Galvin said in the statement.

"After completing our four-month-long technology and strategic reviews in August, I recommended to the board of directors in September that Motorola focus its future on retaining and augmenting all five Motorola sectors that compose our communications products and integrated electronic systems businesses and that our 'asset light' semiconductor business could prosper as a separate entity," Galvin said. "Our board of directors has given its full support to this recommendation."

Motorola, along with IBM and Apple, co-developed the Power PC processor that Apple has used as a platform for its Macintosh-based desktops and notebooks.

However, last month Motorola said it was selling the part of its business that provides system interconnects between PowerPC host processors, the PCI bus and local memory to Tundra Semiconductor, an Ottawa-based fabless chip company.

The Motorola chip business still provides wireless communication and networking processors.

Motorola said all details of the planned spin-off, including its timing, were not immediately available.

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