Google Buys Motorola for $12.5b, Android Partners React Positively.
Monday, August 15, 2011 at 3:26PM Omar Morales Here is the big news of the day if not the week. Today Google announced that it will buy Motorola Mobility for $12.5 billions in cash.
The deal at $40 a share represents a 63% premium for Motorola shares and also mean that Google will be spending around 32% of its cash reserve that until recently hovered at $39 billions.
“Motorola Mobility’s total commitment to Android has created a natural fit for our two companies,” Google CEO Larry Page said in a statement.
Motorola will give Google an end to end user experience similar to Apple but Android is also licensed to may other OEM like Samsung, LG and HTC. Some of them had reacted in a surprisingly positive way.
“We welcome today’s news, which demonstrates Google’s deep commitment to defending Android, its partners, and the ecosystem.”– J.K. Shin President, Samsung, Mobile Communications Division
“We welcome the news of today‘s acquisition, which demonstrates that Google is deeply committed to defending Android, its partners, and the entire ecosystem.”– Peter Chou CEO, HTC Corp
“We welcome Google‘s commitment to defending Android and its partners.” – Jong-Seok Park, Ph.D President & CEO, LG Electronics Mobile Communications Company
“I welcome Google‘s commitment to defending Android and its partners.” – Bert Nordberg President & CEO, Sony Ericsson
Google has stated that Motorola will work as an independent unit and that Android will remain open.
Motorola has a big patent portfolio with 17,000 patents on hand and 7,500 pending that will help Google defend Android against rivals like Apple and Microsoft.
MOUNTAIN VIEW, Calif. & LIBERTYVILLE, Ill.–(BUSINESS WIRE)–Google Inc. (NASDAQ: GOOG) and Motorola Mobility Holdings, Inc. (NYSE: MMI) today announced that they have entered into a definitive agreement under which Google will acquire Motorola Mobility for $40.00 per share in cash, or a total of about $12.5 billion, a premium of 63% to the closing price of Motorola Mobility shares on Friday, August 12, 2011. The transaction was unanimously approved by the boards of directors of both companies.
“Motorola Mobility’s total commitment to Android has created a natural fit for our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers. I look forward to welcoming Motorolans to our family of Googlers.”
The acquisition of Motorola Mobility, a dedicated Android partner, will enable Google to supercharge the Android ecosystem and will enhance competition in mobile computing. Motorola Mobility will remain a licensee of Android and Android will remain open. Google will run Motorola Mobility as a separate business.
Larry Page, CEO of Google, said, “Motorola Mobility’s total commitment to Android has created a natural fit for our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers. I look forward to welcoming Motorolans to our family of Googlers.”
Sanjay Jha, CEO of Motorola Mobility, said, “This transaction offers significant value for Motorola Mobility’s stockholders and provides compelling new opportunities for our employees, customers, and partners around the world. We have shared a productive partnership with Google to advance the Android platform, and now through this combination we will be able to do even more to innovate and deliver outstanding mobility solutions across our mobile devices and home businesses.”
Andy Rubin, Senior Vice President of Mobile at Google, said, “We expect that this combination will enable us to break new ground for the Android ecosystem. However, our vision for Android is unchanged and Google remains firmly committed to Android as an open platform and a vibrant open source community. We will continue to work with all of our valued Android partners to develop and distribute innovative Android-powered devices.”
The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the US, the European Union and other jurisdictions, and the approval of Motorola Mobility’s stockholders. The transaction is expected to close by the end of 2011 or early 2012.
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