Conexant to Spin Off Its Mindspeed Unit

Conexant Systems Inc., a maker of computer chips for communications gear, will spin off its unprofitable Mindspeed Technologies business, which makes semiconductors for Internet equipment.

Mindspeed will receive $150 million in cash from Conexant in initial capital and contingent funding. Conexant will get warrants to purchase common stock representing as much as 20% of Mindspeed, Chief Financial Officer Balakrishnan Iyer said.

Shares of Newport Beach-based Conexant rose 20 cents to $1.67 on Nasdaq.