Lenovo Closes $2.91B Acquisition of Motorola Mobility
Lenovo officially completed the $2.91 billion acquisition of Motorola from Google early Thursday.
As a result of the deal, Lenovo, the Chinese tech firm, gains control of the unit’s Moto and Droid-branded handsets along with its 3,500 employees, 2,800 of whom are based in the US. Motorola will remain as a subsidiary of Lenovo, headquartered in Chicago with offices worldwide.
Liu Jun, Lenovo’s executive vice president and president of its Mobile Business Group, will be the chairman of the Motorola board, while Rick Osterloh, Motorola Mobility President, will retain his position following the deal.
Google’s decision to part with Motorola Mobility and sell it to Lenovo was announced back in January. The search giant bought the phone maker for $12.5 billion in 2012, but it said at the time that its main motive behind the deal was the company’s patent portfolio.
As the deal closes, Google will retain ownership of a majority of the Motorola’s patents, while Lenovo will receive license to 2,000 patents and other intellectual property.
Research firm IDC’s latest report placed Lenovo in the fourth place for smartphone shipments in Q3 2014. With the acquisition deal, Lenovo will, however, knock its country-mate Xiaomi down and become the world’s third bestselling smartphone-maker after Samsung and Apple.
“Today we achieved a historic milestone for Lenovo and for Motorola – and together we are ready to compete, grow and win in the global smartphone market,” said Yang Yuanqing, the current CEO and chairman of Lenovo.
“By building a strong number three and a credible challenger to the top two in smartphones, we will give the market something it has needed: choice, competition and a new spark of innovation.”
Motorola has found recent success with its two Android-based smartphones, Moto G and Moto X, which have helped boost its market share in the industry. In fact, the original version of low-cost Moto G, released last year, was the most successful smartphone in the Motorola’s history.
Shortly before the takeover was completed, the company has also announced its first Nexus device, the Google Nexus 6, which is the first smartphone to debut with Android 5.0 Lollipop operating system. More recently, it also dived into the wearable sector with the Moto 360, which is being considered the best-looking Android Wear watch.
Motorola’s “built solid momentum” will surely help Lenovo propel its market share and boost sales.
“With the complementary strengths of our two companies, we expect to sell more than 100 million mobile devices this year – including smartphones and tablets – by leveraging the Lenovo brand’s leading market position in China, our shared momentum in emerging markets, and Motorola’s strong foothold in mature markets like the U.S,” said Liu Jun.