Google To Acquire Motorola Mobile Phone Business For $12.5B

In a bid to build up its patent arsenal and get a stronger foothold in the mobile phone and tablet business, Google has agreed to acquire Motorola Mobility Holdings for around $12.5 billion in cash.

Motorola Mobility Holdings is one of the entities that resulted when Motorola split its business in two earlier this year. The company focuses on mobile phones and tablets, while the other Motorola company, Motorola Solutions, is oriented toward business and networking technologies. Motorola Mobility has been a strong partner to Google, running all of its smartphones on the Android operating system.

Google said it would operate Motorola Mobility as a separate company, and would continue to license the Android OS to other players.

“We believe that their mobile business is on an upward trajectory and poised for explosive growth,” wrote CEO Larry Page in a blog post.

Page also noted the patent advantage that Google would gain with this buy. “Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio,” he wrote, “which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies.”

The patent issue has been heating up lately, with Google recently accusing others of waging a war against Android, a move that turned out to be a PR blunder and raised questions about Android’s vulnerability.

The deal is subject to the usual regulatory scrutiny in the U.S. and in the European Union, as well as shareholder approval by Motorola Mobility stockholders, but Google says it expects the deal to close at the end of the year or early in 2012.

Related Topics: Channel: Mobile | Google: Mobile

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