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.
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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