Motorola last week announced it would sell its semiconductor components unit to private investment company Texas Pacific Group (TPG) in a deal valued at $US1.6 billion.
The deal involves the Semiconductor Components Group (SCG) unit of Motorola's Semiconductor Products Sector (SPS). It calls for Motorola to receive about $1.6 billion in cash, notes and approximately 10 per cent of the stock of the new company, according to TPG officials.
SCG had sales of about $1.5 billion last year, compared to overall SPS sales of $7.3 billion, Motorola said. Steve Hanson, the current Motorola senior vice president and general manager who heads SCG, will be president of the new business once it is split off from Motorola, the company said.
The deal is expected to be made final in the second half of the year, and is subject to regulatory approval.
Management will have an equity stake in the new company, which will retain the Motorola name for an interim period.
Motorola said that by shedding the components business it will be able to focus on applications for embedded systems.