(Bloomberg) -- Motorola Solutions Inc., the maker of scanners and two-way radios that’s considering a sale, may find itself in the crosshairs of private-equity firms or contractors seeking a bigger slice of the government’s equipment spending.
Motorola Solutions is working with financial advisers as it seeks a buyer, people familiar with the matter said last week. A transaction isn’t imminent and the process has been under way for several months, said one of the people, who asked not to be named because the information is confidential.
“There should be many people who are willing to buy Motorola Solutions at a reasonable price for its special communications technology and existing customer base,” Jun Zhang, a San Francisco-based analyst at Rosenblatt Securities Inc., said in a telephone interview Sunday. “Motorola’s intellectual property should be valuable and attractive to some communication equipment makers.”
Potential buyers could include private-equity firms, which may
want to strip out costs to sell it later, or companies such as Raytheon Co., Honeywell International Inc. and General Dynamics Corp. that could get more government business, said one of the people. A sale may mark the final step in the dismantling of Motorola Inc., which was split up four years ago into Motorola Solutions and a handset unit after a campaign by billionaire Carl Icahn. The handset business was sold to Google Inc., which then sold pieces of it to Lenovo Group Ltd.
It’s possible the search process will end without a deal, one of the people said.
Kurt Ebenhoch, a spokesman for the company, said Schaumburg, Illinois-based Motorola Solutions doesn’t comment on rumors and speculation.
At their closing price of $64.66 on Friday, the shares have gained 2 percent in the past year to give the company a stock-market value of $15.6 billion. The stock jumped as much as 8.3 percent to $70 after the close of regular trading Friday.

Motorola History

Motorola Inc. was founded in Chicago in 1928 as Galvin Manufacturing Corp. to make a device that allowed battery-powered radios to run on household electricity. The company started producing car radios and expanded into communications with public-safety radios. That led to the two-way walkie-talkie and carphones. In 1973, the company began research on a portable phone prototype, using a concept for a cellular network developed by the former AT&T Corp.
Motorola Solutions makes radio equipment for emergency workers and scanning devices for retailers. It’s struggled with earnings performance, with 2014 non-GAAP earnings per share from continuing operations dropping 33 percent as sales declined 6 percent. The outlook for this year remains stagnant -- the company projects 2015 revenue will be flat to slightly lower.

Stagnant Outlook

Motorola Solutions also offers technology services to clients including Prince George’s County in Maryland and the Las Vegas Metropolitan Police Department.
Motorola Inc. first announced a plan to spin off its mobile-phone business in March 2008, amid market share losses and pressure from Icahn. The company delayed the move during the recession, completing the split in January 2011.
The deal for Google’s $12.4 billion purchase of Motorola Mobility, announced just months after the split, marked an end as an independent company that helped pioneer mobile phones and introduced its first consumer handset in the early 1980s.
Google, after subsequently selling off the set-top business, said last year it would sell the remains of Motorola Mobility -- excluding the majority of the patents -- to Chinese PC Maker Lenovo.
In February 2012, Motorola Solutions bought $1.17 billion of its shares from Icahn, and said his representative on its board would step down. Existing shareholders include ValueAct Capital Management and Blackrock Inc.