14 DAY TRIAL // In a move aimed at strengthening the Android ecosystem, Internet giant Google announced plans to purchase Motorola Mobility Holdings, Inc., the popular mobile phone maker. The two have entered an agreement according to which Google would pay $40.00 per share in cash for Motorola Mobility, which represents a premium of 63% to the closing price of Motorola Mobility shares on Friday, August 12, 2011.
Google would pay a total of $12.5 billion for the mobile phone maker, and the deal was already approved by the boards of directors of both companies.
With this transaction, Google hopes to enhance the Android ecosystem, while also tightening competition on the mobile market.
However, the company also announced that Motorola Mobility will remain a licensee of Android, and that the mobile operating system will remain open.
Google plans on running Motorola Mobility as a separate business, and will continue to offer other smartphone makers the possibility to develop new devices based on the platform.
“We expect that this combination will enable us to break new ground for the Android ecosystem,” Andy Rubin, Senior Vice President of Mobile at Google, said.
“However, our vision for Android is unchanged and Google remains firmly committed to Android as an open platform and a vibrant open source community. We will continue to work with all of our valued Android partners to develop and distribute innovative Android-powered devices.”
Motorola Mobility adopted Android a few years ago as part of its strategy to avoid bankruptcy, and has already launched a series of highly acclaimed handsets, such as the Motorola DROID (Milestone) series, DEXT, DEFY, or ATRIX.
“We have shared a productive partnership with Google to advance the Android platform, and now through this combination we will be able to do even more to innovate and deliver outstanding mobility solutions across our mobile devices and home businesses,” Sanjay Jha, CEO of Motorola Mobility, said.