Motorola offers equity security units

October 22, 2001 – Schaumburg, IL – Motorola said it plans to raise $1.275 billion from two offerings and will use the funds to cut short-term debt and for general corporate purposes.

Motorola, which is cutting 26% of its work force this year amid a global slump in demand for telecom equipment, said it had begun a public offering of $875 million equity security units, consisting of senior notes and purchase contracts to buy Motorola shares. Motorola said it may sell another $125 million of the units if there is demand.

The company also said it plans to privately sell $400 million of 10-year senior unsecured notes.

Goldman Sachs & Co., J.P. Morgan, and Salomon Smith Barney are arranging the offering of the equity units, which Motorola said are similar to securities commonly known as ACES (adjustable conversion-rate equity security units), DECS (debt exchangeable for common stock) or MEDS (mandatorily exchangeable debt securities).


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