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January 30, 2014 02:14 am GMT
TechCrunch has confirmed reports that Lenovo is buying Motorola Mobility from Google. This is the division within Google that the company purchased in 2011 for $12.5 billion. The terms of the deal have yet to be revealed but we’re hearing the price was near $3B. According to a separate report published by Reuters, Lenovo is being advised by Credit Suisse Group while Lazard Ltd advised Google on the transaction. According to our source, Google wanted to dump the asset for some time. The company had to hold off selling the division for tax reasons. Motorola Mobility’s performance has yet to live up to its purchase price. Since Motorola split and its consumer division went to Google, it has been a constant source of red ink. Motorola lost quite a lot of money: $248 million in the last quarter alone. Google sums this well, noting that the loss was “-21% of Motorola Mobile segment revenues.” Motorola lost $192 million in the year-ago quarter, so the trend here isn’t positive. This comes just weeks after Google purchased the hot hardware startup Nest. Since then, Nest’s role in the budding conglomerate that Google is turning into has been widely speculated about. With Motorola gone, Nest’s superstar team that includes many former Apple engineers seemingly has an empty playground. As the dust settles on this deal, it’s clear that Google took a large losson its venture with Motorola Mobility. Google acquired an established brand with a vast portfolio of patents, a mature distribution system and a knowledgeable manufacturing arm. Even after pouring money and resources into the historic American brand, Google couldn’t make lemonade with Motorola. Maybe Lenovo, the now-leader in personal computers, will have better luck. More as we get it.
Original Link: http://feedproxy.google.com/~r/Techcrunch/~3/sN8Hoyz_8Zc/
Lenovo To Buy Motorola Mobility From Google For About $3B
TechCrunch has confirmed reports that Lenovo is buying Motorola Mobility from Google. This is the division within Google that the company purchased in 2011 for $12.5 billion. The terms of the deal have yet to be revealed but we’re hearing the price was near $3B. According to a separate report published by Reuters, Lenovo is being advised by Credit Suisse Group while Lazard Ltd advised Google on the transaction. According to our source, Google wanted to dump the asset for some time. The company had to hold off selling the division for tax reasons. Motorola Mobility’s performance has yet to live up to its purchase price. Since Motorola split and its consumer division went to Google, it has been a constant source of red ink. Motorola lost quite a lot of money: $248 million in the last quarter alone. Google sums this well, noting that the loss was “-21% of Motorola Mobile segment revenues.” Motorola lost $192 million in the year-ago quarter, so the trend here isn’t positive. This comes just weeks after Google purchased the hot hardware startup Nest. Since then, Nest’s role in the budding conglomerate that Google is turning into has been widely speculated about. With Motorola gone, Nest’s superstar team that includes many former Apple engineers seemingly has an empty playground. As the dust settles on this deal, it’s clear that Google took a large losson its venture with Motorola Mobility. Google acquired an established brand with a vast portfolio of patents, a mature distribution system and a knowledgeable manufacturing arm. Even after pouring money and resources into the historic American brand, Google couldn’t make lemonade with Motorola. Maybe Lenovo, the now-leader in personal computers, will have better luck. More as we get it.Original Link: http://feedproxy.google.com/~r/Techcrunch/~3/sN8Hoyz_8Zc/
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