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Motorola seeks SEC approval for chip biz spin off

IPO next spring?

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Motorola's chip business could be an independent entity as early as next spring, now that the company has officially sought the approval of the US Securities and Exchange Commission (SEC) for the spin-off.

The necessary S-1 registration statement was made yesterday by SPS Spinco, a short-lived company formed to oversee the Semiconductor Product Sector's IPO. SPS Spinco will run SPS until the IPO is done and dusted.

Having registered the request to spin off SPS, Motorola must now await the SEC's thumbs-up. That typically takes several months while the plan is probed and, if necessary, amendments made. Once approval has been granted, Motorola can set a date for the sale and start trying to persuade investors that independence is the best possible future for its loss-making chip business.

Meanwhile, the US Internal Revenue Service has to agree that the planned distribution of Motorola's shareholding in the spun-off business to all the other shareholders sometime before the end of 2004 should not incur a tax liability. Motorola said that completion of the spin-off is dependent on such an agreement. ®

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