[Update: CONFIRMED!] Google Preparing to Sell Motorola Mobility to Lenovo for $2.91 Billion

[Update: CONFIRMED!] Google Preparing to Sell Motorola Mobility to Lenovo for $2.91 Billion

Update: An official press release on Google’s sale to Lenovo can be found on Google’s Investor Relations page. And according to the PR text, the acquisition is aimed at Motorola Mobility’s product portfolio, whereas Google will maintain ownership of the vast majority of Motorola Mobility’s patents as well as Project Ara. The full text can be found at the bottom of this article.


Back in August of 2011, Google purchased Motorola Mobility for the princely sum of $12.5 billion. This largely seemed to come out of left field for many observers, as Google has only released a handful of self-branded products. This lead many to believe that the primary reason for the acquisition was Motorola’s patent portfolio.

Now two-and-a-half years later, we’ve all seen that Motorola’s patent portfolio wasn’t exactly the magic bullet that many initially thought would save Android from a draconian patent-trolling doom. Instead, Motorola has been hemorrhaging monetary losses ever since its acquisition, dragging down Google’s bottom line and making many wonder why Google paid so much for the ailing division in the first place.

Now, it seems as if Google is in late-stage talks with China-based Lenovo to transfer ownership for $2.91 billion US Dollars. As a reminder, Motorola still holds over 10,000 mobile communications patents, so perhaps Lenovo is looking for these to bolster its own tablet and smartphone portfolio. In any case, if the rumored acquisition and figures are true, this sale lends credence to the notion that Google vastly overpaid in the $12.5 billion acquisition.

Lenovo and Google have both declined to officially comment on the matter. But according to ChinaDaily, Lenovo has stated that it s readying an announcement regarding a “major acquisition.

What are your thoughts on Google’s potential sale of Motorola to Lenovo? Does this prove just how much of a mistake the initial acquisition was in the first place? Let us know your thoughts in the comments below!

[Source: ChinaDaily, NYTimes | Thanks to my friend Raja for the tip.]


Google Investor Relations Press Release:

Lenovo to Acquire Motorola Mobility from Google

Research Triangle Park, North Carolina, and Mountain View, California – January 29, 2014: Lenovo (HKSE: 992) (ADR: LNVGY) and Google (NASDAQ: GOOG) today have entered into a definitive agreement under which Lenovo plans to acquire the Motorola Mobility smartphone business. With a strong PC business and a fast-growing smartphone business, this agreement will significantly strengthen Lenovo’s position in the smartphone market. In addition, Lenovo will gain a strong market presence in North America and Latin America, as well as a foothold in Western Europe, to complement its strong, fast-growing smartphone business in emerging markets around the world.

The purchase price is approximately US$2.91 billion (subject to certain adjustments), including US$1.41 billion paid at close, comprised of US$660 million in cash and US$750 million in Lenovo ordinary shares (subject to a share cap/floor). The remaining US$1.5 billion will be paid in the form of a three-year promissory note.

Lenovo, which in 2005 acquired IBM’s PC business and its legendary PC brand, will now acquire world-renowned Motorola Mobility, including the MOTOROLA brand and Motorola Mobility’s portfolio of innovative smartphones like the Moto X and Moto G and the DROID™ Ultra series. In addition to current products, Lenovo will take ownership of the future Motorola Mobility product roadmap.

Google will maintain ownership of the vast majority of the Motorola Mobility patent portfolio, including current patent applications and invention disclosures. As part of its ongoing relationship with Google, Lenovo will receive a license to this rich portfolio of patents and other intellectual property. Additionally Lenovo will receive over 2,000 patent assets, as well as the Motorola Mobility brand and trademark portfolio.

Motorola Mobility enjoys outstanding brand awareness around the world, and is currently the #3 Android smartphone manufacturer in the U.S. and #3 manufacturer overall in Latin America.

“The acquisition of such an iconic brand, innovative product portfolio and incredibly talented global team will immediately make Lenovo a strong global competitor in smartphones. We will immediately have the opportunity to become a strong global player in the fast-growing mobile space,” said Yang Yuanqing, chairman and CEO of Lenovo. “We are confident that we can bring together the best of both companies to deliver products customers will love and a strong, growing business. Lenovo has a proven track record of successfully embracing and strengthening great brands – as we did with IBM’s Think brand – and smoothly and efficiently integrating companies around-the-world. I am confident we will be successful with this process, and that our companies will not only maintain our current momentum in the market, but also build a strong foundation for the future.”

“Lenovo has the expertise and track record to scale Motorola Mobility into a major player within the Android ecosystem. This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere,” said Larry Page, CEO, Google.

“As part of Lenovo, Motorola Mobility will have a rapid path to achieving our goal of reaching the next 100 million people with the mobile Internet. With the recent launches of Moto X and Moto G, we have tremendous momentum right now and Lenovo’s hardware expertise and global reach will only help to accelerate this,” said Dennis Woodside, CEO, Motorola Mobility.

The transaction is subject to the satisfaction of regulatory requirements, customary closing conditions and any other needed approvals.

About author

Will Verduzco
Will Verduzco

Will Verduzco is the former Editor-in-Chief and Portal Administrator of the XDA-Developers Portal. He has been addicted to mobile technology since the HTC Wizard. But starting with the Nexus One, his gadget love affair shifted to Google's little green robot. You can now find Will writing for the Swappa Blog, though he still pops up on XDA from time to time.