• March 27, 2008

Motorola announced Wednesday that it will split into two publicly trade companies: one focused on selling network equipment, set-top boxes and two-way radios, and the other on mobile devices.

The move, aimed at separating Motorola's struggling handset business from the rest of the company's operations, was long sought by billionaire investor Carl Icahn. He recommended splitting the company into two business units the day after former Motorola CEO Ed Zander announced his departure at the end of 2007.

Motorola's cell phone business has suffered since its once-popular Razr fell out of favor. During the fourth quarter, its phone shipments fell 38% as rivals' sales increased. The board is now looking for a new chief executive for the handset business. Motorola's shares closed at $10.02 Wednesday--up 2.6%.

--Mark Walsh