Today it became known that Google has sold its Motorola Home division for a combination of $2.35 billion in cash and stock to Arris.
The deal is not unexpected, as Arris was tipped to be a late-stage contender for the corporate asset.
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Google purchased Motorola to build its mobile division, and to become its own smartphone OEM. The other facets of Motorola were likely less appealing to it. Offloading non-core assets for cash is always a palatable move. The Arris Group picked up Motorola Home, which Google had placed on the block some time past.
Motorola cost Google some $13 billion when it was purchased. Google is therefore remunerating itself to the tune of 18% of the initial price.
According to the official release, Google will collect $2.05 billion in cash, and $300 million in Arris stock. Google will retain a 15.7% share in Arris after the transaction.
As you might expect, intellectual property was a key component of the deal. Arris noted that its purchase will grant it an expanded “patent portfolio and provide a license to a wide array of Motorola Mobility patents.” As Google itself bought Motorola partially for its intellectual property, Arris having that access is a real boon that surely factored into the price of the deal.
The combination of Arris and Motorola Home creates a massive corporation, with combined trailing twelve month revenue of $4.7 billion.
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