Moody's Investors Service raised its ratings outlook on Motorola Inc. (MOT) to positive--likely ending the near-term likelihood that the company will be cut to junk territory--as the telecommunications-equipment maker has agreed to sell most of its network-equipment business to telecom-equipment vendor Nokia Siemens Networks for $1.2 billion.

Nokia Siemens is a joint venture of Finland's Nokia Corp. (NOK, NOK1V.HE) and Germany's Siemens AG (SI, SIE.XE).

Earlier Monday, Standard & Poor's Rating Services and Fitch Ratings said their grades wouldn't be affected by the pending sale.

Moody's said the sale is expected to boost Motorola's credit profile by giving it significant cash balances. The company plans to separate itself into two independent publicly traded companies through a spinoff of its mobile-devices and home businesses.

After the separation, expected in the first quarter, Moody's sees the debt remaining with Motorola Solutions, which generated first-quarter earnings of $141 million and revenue of $1.7 billion as the largest unit in the company.

Moody's has Motorola at Baa3, the lowest rung of investment grade. The previous ratings outlook was negative.

Motorola shares recently traded at $7.93, up 5.7%, on the divestiture plan. The stock is up 2% this year

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