Google and Motorola Mobility have announced that they have entered into a definitive agreement under which Google will acquire Motorola Mobility for $40.00 per share in cash - or a total of about $12.5 billion.
The figures represent a premium of 63 per cent to the closing price of Motorola Mobility shares on Friday and illustrate the growing importance of mobile technology to the online giant.
The transaction was unanimously approved by the boards of directors of both companies.
The acquisition of Motorola Mobility, a dedicated Android partner, will enable Google to “supercharge” the Android ecosystem and will enhance competition in mobile computing.
Motorola Mobility will remain a licensee of Android and Android will remain open.
Google will run Motorola Mobility as a separate business.
Larry Page, chief executive of Google, said: “Motorola Mobility’s total commitment to Android has created a natural fit for our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers.
“I look forward to welcoming Motorolans to our family of Googlers.”
The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the US, the European Union and other jurisdictions, and the approval of Motorola Mobility’s stockholders.
The transaction is expected to close by the end of 2011 or early 2012
Sanjay Jha, chief executive of Motorola Mobility, said: “This transaction offers significant value for Motorola Mobility’s stockholders and provides compelling new opportunities for our employees, customers, and partners around the world.
“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.”