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Motorola Sells Portion of Government Fuze Business While Keeping Its Employees First Priority.

SCOTTSDALE, Ariz.--(BUSINESS WIRE)--Sept. 15, 1997--Motorola Space and Systems Technology Group (SSTG) signed a letter of intent (LOI) with Hopkins, Minn.-based Alliant Techsystems, which details the selling of a portion of Motorola's Tactical Systems Operations (TSO) business unit responsible for the design and development of military fuzes for the U.S. government.

Annual sales of Motorola's TSO business unit is approximately $45 million. The estimated value of this business transaction is $12 million in cash plus additional considerations and future royalties.

Stipulated in the LOI, Alliant Techsystems will purchase Motorola's penetrator fuzing, projectile fuzing, proximity sensors and fuzing, and electronic safe and arming device businesses. Current plans call for Motorola to exhaust its existing fuze backlog and not to pursue any fuzing business that may result in a backlog extension beyond the year 1999.

According to Durrell Hillis, senior vice president and general manager of Motorola SSTG, "Motorola has been a major participant in U.S. fuzing development and production over the past four decades. However, as a future growth engine for the company, we are constantly in the process of reevaluating all of our business areas. This decision was made to focus our future efforts in becoming a market leader in advanced communications systems."

The majority of employees currently working on these government fuze programs will remain Motorola employees. However, Alliant Techsystems will have the opportunity to actively recruit some Motorola employees with particular technology expertise and skills to help ensure the future success of the business.

In the interim, Motorola services will be subcontracted to Alliant Techsystems until contract completion. This will provide for a "seamless" transition to Alliant Techsystems of government fuze programs presently contracted to Motorola, as well as providing our government customer critical continuity with Alliant Techsystems.

Ken Fredericks, vice president and director of Motorola SSTG human resources stated, "The welfare of our employees is our first and primary consideration. Alliant Techsystems proved to be an excellent company that offers similar benefits to Motorola. This agreement is truly a win-win situation for everyone."

Motorola (NYSE:MOT) is one of the world's leading providers of wireless communications, semiconductors and advanced electronic systems, components and services.

Major equipment businesses include cellular telephones, two-way radios, paging and communications, personal communications, automotive, defense and space electronics and computers. Communications devices, computers and millions of consumer products are powered by Motorola semiconductors. Sales in 1996 were $28 billion.

CONTACT: Motorola SSTG, Scottsdale

Robert Edwards, 602/441-2885



Alliant Techsystems, Hopkins

Rod Bitz, 612/931-5413

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Publication:Business Wire
Date:Sep 15, 1997
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