Motorola welcomes Google slurp with open arms
99 out of 100 shareholders choose Google
Motorola shareholders have voted overwhelmingly to accept Google’s $12.5bn bid to buy the company’s mobile phone arm, and any patents it may happen to have lying around.
Over 99 per cent of shareholders who voted approved of the deal, representing nearly three-quarters of the total shares. Google had hoped to see the purchase completed by the end of the year, but a probe by federal regulators has scotched that deadline, and the company now says it’s aiming for early 2012, barring factors outside of its control.
“We are pleased and gratified by the strong support we have received from our stockholders, with more than 99 percent of the voting shares voting in support of the transaction,” said Sanjay Jha, chairman and CEO of Motorola Mobility in a statement. “We look forward to working with Google to realize the significant value this combination will bring to our stockholders and all the new opportunities it will provide our dedicated employees, customers, and partners.”
Certainly the future’s looking a lot brighter for him personally, although El Reg doubts the 800 staffers that Motorola laid off ahead of the deal are feeling quite so thankful. The shareholders will also be happy – Motorola stock was going nowhere but down when Google offered to buy at a 63 per cent premium. Motorola’s board got a very good deal for themselves and their stockholders by bargaining hard.
Google also seems to be happy with the deal. It claims its primary motivation for the purchase was Motorola’s income-generating patent portfolio, although there are serious doubts as to the actual value it’ll represent in Google’s legal battles. Having Motorola’s losses to offset against future taxes is also a nice sweetener to the deal.
The coming federal investigation is going to prove expensive in lobbying fees, but should get through relatively quickly. There’s little the feds will ask for that Google won’t be prepared to give, and it may actually welcome the chance to spin off Motorola's handset division in exchange for control of tablets. It would certainly soothe some troubled brows from rival smartphone manufacturers.
Google has issued fervent assurances that Motorola will not get preferential treatment if the deal goes ahead, but it’s going to be interesting to see how this works in reality, and if other manufacturers will accept the new situation.
Samsung already has a boot in the Phone 7 camp, HTC has long danced to Redmond’s tune, and once again Microsoft is telling us that this time it has got mobile right – and is prepared to sue everyone using Android for damages as an incentive. Google’s acquisition could be just the thing to make supporters switch sides, and the company could end up paying a lot more than the apparent purchase price. ®
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