Freescale Semiconductor Looking to Sell Mobile Chips Division

Computer-chip manufacturer, and former Motorola subsidiary, Freescale Semiconductor is looking to sell off its mobile-phone chip division, the company confirmed in a statement. The company is understood to have been hurt by the slowdown in mobile handset sales from Motorola, which remains one of its largest customers. The division generates on average around 20% of the group's revenues.

The companyĆ's cellular handset products business includes baseband processors, RF transceivers, power management/audio, software and platforms for the cellular handset market. The company also announced it has updated its arrangement with Motorola whereby Motorola agreed to provide certain consideration in exchange for eliminating their remaining minimum purchase commitments.

Chairman and chief executive officer Rich Beyer said, "In the cellular handset chipset market, it has become evident that this business needs considerably greater scale in order to achieve a position of market leadership and long-term success. We feel the investment required to achieve that scale by Freescale will be better served extending our product portfolios where we are the leader and expanding our application expertise in sensors, analog, power and multimedia processing."

The company intends to increase R&D funding to expand their processing, RF, sensor and analog power management expertise into new high-growth market segments like personal medical devices, smart energy metering and home networking.

In October 2003, Motorola announced that it would separate its computer chip business into a separate company, and floated it on the stock market in July 2004. In September 2006 Freescale agreed to accept a buyout for the sum of $17.6 billion by a consortium led by Blackstone Group.

Posted to the site on 3rd October 2008