Report: Motorola may buy set-top maker for $US10 billion

Motorola is reportedly mulling over a $US10 billion all-stock purchase of television set-top box maker General Instrument, a move that would place Motorola firmly in the broadband services market space.

Motorola is reportedly mulling over a $US10 billion all-stock purchase of television set-top box maker General Instrument, a move that would place Motorola firmly in the broadband services market space.

Should the deal go ahead, General Instrument shareholders will get just over half a Motorola share for each of their General Instrument shares, according to a report in the Wall Street Journal. The set-top box maker would become a unit of Motorola and would retain its current chief executive officer, Edward Breen, the report said. The purchase could occur as early as this week, the report added.

Motorola and General Instrument were not available for comment.

Motorola makes chips that fuel set-top boxes, so a potential marriage between the two vendors could be advantageous for both sides. It's likely that the General Instrument devices will be rebranded Motorola if the purchase goes ahead, the report said. Motorola's distribution channels could help bring set-top boxes to many more consumers, the report added.

In December of last year, Sony subsidiary Sony of America announced it was acquiring 7.5 million General Instrument shares for $187.5 million, a purchase of a roughly 5% stake in the company. At the same time, General Instrument said it would license Sony's Home Networking Module and its Aperios real-time operating system, and would collaborate with Sony on developing digital cable set-top boxes.

In January of this year, General Instrument teamed up with Cisco Systems Ito assist AT&T in developing the necessary technology for an IP (Internet Protocol) network.

Motorola, based in Schaumburg, Illinois, can be contacted at 1-847-576-5000 or via the Internet at http://www.mot.com/.General Instrument, in Horsham, Pennsylvania, can be reached at +1-215-323-1000 or via the Internet at http://www.gi.com/.

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