April 2, 2008: 1:58 PM EDT
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A new low for Motorola

Motorola's dismal week now includes an offer for its phone unit that confirms its place in the bargain basement of the tech marketplace.

By Scott Moritz, writer

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Motorola's last triumph was its groundbreaking RAZR phone in 2005.

NEW YORK (Fortune) -- Motorola may have just had its worst week ever.

It started with a joyless plan to jettison the mobile phone business last Wednesday. The announcement pushed the stock to a four-year low. That play was followed by a forfeit - a glaring absence of new phones at the wireless industry's event going on now in Las Vegas. But the crowning achievement of the week has to be an unsolicited, and so far unacknowledged offer for the phone unit from Videocon, a big consumer electronics company in India.

The news that the suitor wasn't exactly Nokia (NOK) or Sony Ericsson or even China's ZTE brought home a message that many Motorola (MOT, Fortune 500) watchers have already come to uncomfortable terms with: The once proud phone giant has fallen to bargain basement levels.

Some observers have even gotten to an actual estimated dollar value for the money-losing phone business, if Motorola were to spin it off. Money manager-cum-blogger Chad Brand wrote Monday that the remaining businesses, like set-top TV boxes, wireless infrastructure and the walkie-talkie operations, would trade for about $8 a share. At the time, Motorola' stock price was hovering around $9, meaning the phone business was worth roughly $1 a share.

At these prices, it's probably not terribly surprising that some far-flung potential bidders have taken an interest in the No. 3 phone maker.

There was no dollar value attached to the Videocon inquiry, and chairman Venugopal Dhoot did not immediately reply to an e-mail. Videocon's most recent takeover plays include a failed bid for South Korea's Daewoo electronics, the successful acquisition of Thomson's cathode ray TV tube business and the purchase of Electrolux's India unit.

To be sure, India is a rising player in the global market. The recent $2.3 billion deal by Tata Motors (TTM) to acquire Ford's (F, Fortune 500) Jaguar and Land Rover units is the most recent illustration of the growing financial power of India's industrialists. But in this case, Tata has some experience in the auto industry with 22 years of car manufacturing.

If nothing else, Videocon's ambitions are high. The company plans to launch a wireless phone service by year end and hopes to have 20 million customers in four years, Dhoot told Bloomberg in an interview earlier this year. But Videocon will need substantial financing to swing a deal for Motorola's handset operation, even at these prices. Notably, its $711 million bid for Daewoo was ultimately rejected by creditors.

Next week could bring more offers. But this being Motorola, it could also be the even worse week ever. To top of page