Family businesses can be quite powerful, as seen with the legendary Hewlett-Packard
But Motorola appears to be another story. In January 2004, Ed Zander took the CEO spot from a family member. Prior to this, he was the COO of Sun Microsystems
But coolness is not Zander's only focus. This week, shareholders got a glimpse at his plans to increase shareholder value. The company announced that the board authorized the repurchase of $4 billion in common stock over a 36-month period. This represents roughly 10% of the company's market cap. And interestingly enough, this is the first time in Motorola's 77-year history that it has instituted a repurchase program.
Now, this is not an admission that there are no more growth opportunities for Motorola. The company has $11.3 billion in short-term investments and cash equivalents. What's more, it continues to generate strong cash flows.
But there is something else encouraging here; that is, by giving back money to shareholders, there is less temptation to make a massive acquisition. Given that the history of big tech acquisitions is spotty at best (with the most prominent disaster being the HP and Compaq combination), that's probably a good thing. Instead, Zander appears to be growing his business with R&D and other initiatives, and making sure any excess goes back to shareholders. And that's always in style.