Motorola sells embedded communications computing business for $350M

By Colleen Taylor, Contributing Editor -- Electronic News, 9/28/2007

Mobile phone maker Motorola Inc. has entered into a definitive deal to sell its embedded communications computing (ECC) business to St. Louis-based electronics maker Emerson Electric Co. for $350 million in cash.

The sale should help Motorola in the efforts it has undertaken of late to recover from a string of disappointing quarterly earnings reports that was most recently punctuated by a Q2 net loss of $28 million. In recent months, Motorola has attempted to cut costs by announcing some 7,500 job cuts and conducting several major managerial changes.

Upon completion of the transaction, Motorola's ECC business will become part of Emerson Network Power. The companies said that the transaction is expected to be completed by the end of the calendar year and is subject to customary closing conditions and regulatory approvals.

Formed in 1980, Motorola's ECC business provides embedded computing products and services to communication infrastructure and equipment manufacturers in telecommunications, medical imaging, defense and aerospace and industrial automation. Based in Tempe, Arizona, Motorola's ECC business has approximately 1,100 employees.

Emerson said in a statement today that the transaction "enhances its ability to meet the embedded computing needs of customers in telecommunications and other industries." Meanwhile, the companies said that for Motorola the transaction "sharpens its focus on its core businesses and technologies and provides additional capital to drive further growth and enhance shareholder value."