You have probably heard it already: Google just announced that they are going to buy Motorola’s Mobile division, Motorola Mobility. The official press release on Google investor relations confirms that Google will pay $40.00 per share for a total sum of about $12.5 billion US Dollars which is a 63% premium “to the closing price of Motorola Mobility shares on Friday, August 12, 2011″.
Google’s plans for now are to run Motorola Mobility as a separate business that remains one of the licensees of Android. Nothing will change for the Android platform which will remain open for all hardware partners according to Larry Page’s post on the official Google blog.
Google’s CEO reveals furthermore the motivation behind the deal. Google believes that Motorola’s mobile business is “on an upward trajectory and poised for explosive growth” thanks to the concentration on Android as the sole operating system for all of its smartphones.
Motorola is also seen as a market leader in the “home devices and video solutions business”.
Probably more interesting than that is Motorola’s patent portfolio which is explicitly mentioned by Larry Page on the Google blog post.
Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies.
While I cannot really vouch for or against Motorola’s patent portfolio, it needs to be noted that Microsoft has sued the company back in 2010 for infringing on Microsoft patents.
Google expects the transaction to close by the end of 2011 or early 2012 if it is approved by Motorola stockholders and regulatory approvals in the US and the European Union.
It will be interesting to see how Microsoft and Apple will react, and if and how Motorola Mobility smartphones and tables will benefit from this.
What’s your take on the acquisition? Let me know in the comments.
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