Last updated: August 4, 2008 10:00 pm

Motorola taps Qualcomm for mobiles chief

Motorola scored a coup on Monday with the recruitment of a highly rated executive to head its mobile phone business, which will be spun out of the US electronics group next year.

The company named Sanjay Jha, Qualcomm chief operating officer, to lead the unit, sending its shares up 10 per cent by midday in New York.

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The appointment ends a four-month search for a chief executive for the mobile phone arm, which has been struggling with losses and declining market share for 18 months after failing to update its mobile phone portfolio and relying for too long on sales of the ageing Razr handset.

Analysts said Mr Jha’s appointment was expected to give the unit credibility and quell doubts that Motorola would go through with plans to split off the mobile phone business in the third quarter next year.

He will be replaced at Qualcomm by Len Lauer, who joined Qualcomm from Sprint Nextel, the third largest US mobile network operator.

Motorola’s stock gained more than 11 per cent, closing at $9.82.

“Motorola is getting a leader with great technical background, industry experience and business savvy,” said Mark McKechnie of American Technology Research.

Mr Jha, who has helped turn Qualcomm into a mobile phone chip powerhouse since he joined in 1994, was also named Motorola’s co-chief executive, a role he will share with Greg Brown, Motorola’s current chief.

“This is the culmination of several months work,” Mr Brown said. “We got the best candidate available and I am confident Motorola is on its way back.”

Mr Brown, who took over as chief executive of the struggling company in January, bowed to shareholder pressure led by Carl Icahn, the Wall Street investor, in March and agreed to spin off the mobile devices business.

Motorola’s second-quarter results released last week showed that Mr Brown had made some progress in stabilising the unit.

While it still reported a loss, strong mobile phone sales in North America enabled Motorola to narrowly hang onto its ranking as the third largest mobile phone maker behind Nokia of Finland and Korea’s Samsung.

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