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Motorola sells modem unit
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April 29, 1998: 4:26 p.m. ET
Company sheds division to focus on higher-margin products
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NEW YORK (CNNfn) - Motorola Inc. has sold its Transmission Products division to a group of international investors.
The division, part of Motorola's Information Systems Group, was responsible for development of the company's consumer-oriented ModemSURFR and VoiceSURFR modem lines.
The new business will be named CPATH Inc. and will based in Hunstville, Ala., the site of the existing Motorola division.
Motorola did not disclose financial terms of the deal, though it said it will retain an equity interest in CPATH. The company expects the transaction to be completed around May 8.
Shannon Clemons, a Motorola spokeswoman, said the company has been working since last fall to shed business units that "no longer fit its strategic portfolio."
Aydin Tuncer, telecommunications analyst at S&P Equity Group, said the sale will allow Motorola to focus on its higher-margin businesses.
"Modems are very low-margin products," he said. "It's a good move in that they want to focus on high-value products, like digital signal processors for semiconductors, high-level paging products and their satellite business."
CPATH will take over manufacture and distribution of the SURFR series in addition to developing other products. Motorola said it will continue to develop corporate, cable and software modems at other facilities.
Shares of Motorola (MOT) fell 7-16 to 55-7/16 in late-day trading. 
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