Mumbai, April 1: Videocon Industries, the consumer electronics giant, is planning to bid for Motorola Inc’s handset business.

Last Wednesday, Motorola announced that it would spin off the money-losing mobile phone business — succumbing to relentless pressure from billionaire activist investor Carl S. Icahn, who is Motorola’s second biggest shareholder with a roughly 6 per cent stake.

Reports indicate that Motorola plans to concentrate on its profit-making arm that sells network equipment, set-top boxes and two-way radios.

Although it has spoken about spinning off the handset business that is famous for its ultra-slim Razr phones, Motorola hasn’t yet unveiled plans to put it on the block.

If it does so, Videocon will immediately submit an expression of interest for the handset business.

The buzz is that Motorola will announce its plans for the handset business within the next seven days.

“We do not comment on rumours,” Motorola spokesperson Jennifer Erickson said over the phone from Illinois.

Motorola’s handset business has come under intense pressure over the past few months from rivals such as Nokia, Apple and Samsung. It lost $388 million last quarter. Estimates put the enterprise value of Motorola’s handset business anywhere between $3 billion and $4 billion.

Venugopal Dhoot, chairman of the Videocon group, told The Telegraph that the group had hired one of the top three investment banks in the world to advise it on the deal. He refused to name the firm.

Dhoot said an acquisition of the handset unit would be highly synergistic with the group’s businesses.

Datacom, Videocon’s subsidiary, has a pan-India licence to start cellular operations in 22 circles. The group also has a chain of 900 retail showrooms called NEXT which sells mobile phones and other electronic goods. Sources said Motorola’s handset business would complete the chain in Videocon’s telecom business.

“In cellular business, we are planning to have a customer base of over 2 crore within the next five years. We are also a big distributor of mobile phones in India. There is a good potential for the mobile phone market in India,” he added.

Videocon has made several global acquisitions in the past. In 2005, it acquired Thomson SA’s global colour picture tube manufacturing business including units in China, Poland, and Mexico for 240 million euros. It also bought the entire shareholding of AB Electrolux in Electrolux Kelvinator Ltd.

Although it had bid for Daewoo Electronics, the deal fell through because of differences with the Korean firm’s creditors over pricing.