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We’ve been hearing a bit lately about how Motorola’s top investors haven’t been too happy with their mobile handset unit. And why would they? They were knocked off their perch as the world’s No. 2 handset maker this year, supplanted by Samsung. However, despite this, CEO Greg Brown said earlier this month that they were looking for a new mobile chief, but now it appears they’ll be looking for someone to buy their mobile unit. The pressure was applied by billionaire investor Carl Icahn. The split, though, is expected to happen next year, with the hope that it buys Motorola time to make the sale more attractive.

“If they had been forced to sell it off, shareholders would have been forced to accept a bargain basement price,” said Richard Windsor, a Nomura International analyst in London who recommends holding on to the stock. The move is “the one that makes the most sense for shareholders.”

I’m not quite sure how they’re going to beef up their holdings over the next year or so, but that’s what they’ll have to do to avoid selling low. Sales at Motorola have declined for four straight quarters.

The problems are said to have been around for a while, though they were masked when the RAZR came along and revolutionized the slim-phone market. Says Michael Walkley, analyst from Piper Jaffray & CO.: “Once Razr sales started to fade, their cost structure wasn’t competitive, especially now that they don’t have the right products for the market.”

With the rise of smartphones, Motorola has just the Q. While it’s a neat-looking device, I’ve heard more complaints about it than any other line of smartphone. They have made some decent sales on the RAZR 2, though.

After the sale, Motorola will focus on selling network equipment, cable TV set-top boxes, and two-way radios. They hope that absent funding or their mobile phone R&D, they can return to highly profitable business.

[Bloomberg]

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