Motorola (MOT) breaks itself into more pieces

Motorola (NYSE: MOT) has already decided to spin-off its largest and least successful unit, its handset business. The company's stock is near a 52-week low, trading at $7.25, making the firm's market cap less than $16.5 billion. Some analysts wonder if the handset business has any inherent value at all. It is losing hundreds of millions of dollars a quarter and its revenue is in a sharp decline.

Getting rid of one division may not be enough for the company. It may be preparing to auction off more of its businesses. According to The Wall Street Journal, the electronics company "is reorganizing its second-largest business unit, home and networks mobility, into three distinct businesses." One unit will focus on set-top boxes, another on traditional cellular infrastructure, and a third on new technologies including WiMax.

The move assumes a certain stupidity on the part of Wall Street -- particularly the analysts who cover the company. Setting up the discrete units probably does not make them easier to sell. In Motorola's future financial statements, it may make the performance of each business more easy to see, but the pros can already figure that out.

The more simple message from the move is that Motorola now appears determined to try to improve its share price by selling as much of the company as it can.

It is a deeply pessimistic move. It assumes that current management cannot get a good yield from the assets that will be left after the handset business is gone. It represents a surrender rather than a fight to make its remaining businesses better.

Douglas A. McIntyre is an editor at 247wallst.com.