Motorola finally sells modem division:
Seven months after putting it up for sale,
Motorola Inc. has finally unloaded its
Transmission Products Division to a group of
investors.
The deal, which includes the majority of Motorola's analog desktop and
PC Card modems, should be completed by May 8, according to Motorola
officials, who declined to disclose financial terms.
The investors will form a new business called Cpath Inc., which will
operate out of the current site of the Transmission Products Division, in
Huntsville, Ala.
Rick Lane, currently the vice president and general manager of the
division's mass market business, will become CEO of Cpath. Motorola
(MOT) will hold an equity investment in the new company.
Cpath investors said they would not comment on the acquisition until it is
complete. But industry analysts were scratching their heads.
"I'd like to know what they were thinking," said Lisa Pelgrim, an analyst at
Dataquest Inc., in San Jose, Calif. "Right now 3Com [Corp.] owns this
market, and everyone else is a niche player."
Cpath will have rights to the Surfr brand name but will not be permitted to
use the Motorola name or bat-wing logo.
Cpath will continue the manufacture of all modems in the Surfr series.
The company also plans to extend its medley of products, but declined to
say how.
Motorola will provide customer service for modems sold before Cpath
bought the division. V.90 upgrades for Motorola's 56K-bps modems are
due in the second quarter, and the company plans to post the upgrades on
its Web site at www.motorola.com/modems.
Motorola also plans to reduce prices on modems currently on the market
to clear the channel for the Cpath v.90 modems, officials said.
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