Motorola, the struggling mobile phone maker, yesterday announced plans to spin off its computer chip business into a separately traded company.
The move comes barely two weeks after the sudden resignation of former chairman and chief executive Christopher Galvin, amid reported clashes with the board over company strategy.
The spin-off will allow Motorola to focus on its handsets and networks business.
Investors responded positively to the move, marking Motorola shares up nearly 8% to $13.20 in early trade. Shares in the company were worth more than $60 when Mr Galvin, the grandson of Motorola's founder, was appointed six years ago.
Mr Galvin's decision to step down triggered expectations on Wall Street that his replacement would accelerate restructuring at the company - something investors have long called for. But few had expected the break-up to come so soon.
Analysts said there could be further spin-offs. Motorola also makes automotive electronics, and products for cable and broadband networks.
The company said it had not finalised details of the spin-off, which will create one of the top 10 semiconductor firms in the world.
