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Motorola Droid 3
Google will acquire Motorola Mobility for $12.5 billion USD

Well, we didn't see that one coming. Google just announced today via its official blog that itwould be acquiring Motorola Mobility, an American company that produces everything from the Wayans Family-esque lineup of Droid smartphones to the 10.1" Xoom tablet.

The transaction price comes in at a relatively modest (for Google) $12.5 billion, which at $40/share represents a 63 percent price premium over Motorola Mobility's closing price on Friday (MMI is up nearly 60 percent following the opening bell). Not surprisingly, the deal was unanimously approved by both companies' boards.

“This transaction offers significant value for Motorola Mobility’s stockholders and provides compelling new opportunities for our employees, customers, and partners around the world," said Sanjay Jha, CEO of Motorola Mobility. "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.”

“We expect that this combination will enable us to break new ground for the Android ecosystem," added Andy Rubin, Google's Mobile SVP. "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.”

If there are no legal roadblocks in Google's path, the deal will be completed by early 2012.

According to Google CEO Larry Page, the move to purchase Motorola Mobility will not have an affect on the openness of the Android operating system. "We will run Motorola as a separate business," said Page. "Many hardware partners have contributed to Android’s success and we look forward to continuing to work with all of them to deliver outstanding user experiences."

Page goes on to say that we should expect to see great things on the hardware and software side of things:

The combination of Google and Motorola will not only supercharge Android, but will also enhance competition and offer consumers accelerating innovation, greater choice, and wonderful user experiences. I am confident that these great experiences will create huge value for shareholders.

This purchase will also give Google access to a treasure trove of patents in order to defend itself from competitors. According to The Street, Motorola has a war chest of over 17,000 patents.

Interestingly, Motorola Mobility's Sanjay Jha seemed quite receptive to using Microsoft's Windows Phone 7 operating system just last week. We can now safely assume that those notions are completely dead.

Updated 8/15/2011 @ 3:30pm

Google has posted four quotes from other Android handset makers regarding the acquisition of Motorola Mobility. It seems quite odd how robotic and same-sounding all of the quotes are…

“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

“I welcome Google‘s commitment to defending Android and its partners.” -- Bert Nordberg, President & CEO, Sony Ericsson

“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



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This Could Be Good
By Sazabi19 on 8/15/2011 8:09:06 AM , Rating: 2
I hope that this is good. I like my Moto Orig Droid and I think Google wants to start making cash on these phones and that is why they are eating Moto. With google making the phone their OS is on it could be a great move. Also let's hope they won't try to choke out the other companies, competition is fueling the market right now furiously with each maker trying to continually come out with better phones... we see where a single manufacturer of a single device has made things... stale, almost more like a rotten fruit if you will.




RE: This Could Be Good
By tng on 8/15/2011 9:07:29 AM , Rating: 2
quote:
almost more like a rotten fruit if you will.
LOL


RE: This Could Be Good
By Samus on 8/15/11, Rating: 0
RE: This Could Be Good
By DanNeely on 8/15/2011 10:28:28 AM , Rating: 2
quote:
I'd also guess Nokia's value is 2-3 times that of Motorola, putting it out of reasonable price range for these companies.


Nokia's current market cap is $22bn (down from a peak of $150bn in jan 08); roughly 3x Moto's prior to the Google offer. Buying it is still in the realm of the possible for MS; but would be a huge dent in their bank account. OTOH if its price keeps falling...


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