As the reverberations from Google’s acquisition of Motorola have started to simmer down, Om Malik of Gigaom writes that Motorola was keen on selling and that Google wasn’t the only interested suitor.
Microsoft was also interested in purchasing Motorola and acquisition discussions between the two companies had reportedly been ongoing for some time. Driving Microsoft’s interest in Motorola was their patent portfolio which if held in their position, Malik writes, would have given them to tighten the screws even more on Android.
Microsoft is currently suing Motorola for patent infringement and legal experts say that Motorola’s legal case isn’t looking terribly strong. Indeed, while analysts and even Google and Google’s partners have been stating that the Motorola purchase will help defend Android, it’s important to remember that Motorola’s “scary” patent portfolio did absolutely nothing to deter Microsoft and Apple from aggressively suing the Illinois-based company for multiple counts of patent infringement.
Sources tell Malik that Motorola was more at ease with the Google acquisition because Microsoft had no interest in getting into the hardware business and was solely interested in patents which number 17,000 in addition to approximately 7,500 patents currently pending.
While we don’t know if Motorola drove up the asking price by playing Google and Microsoft against each other, suffice it to say that Motorola certainly knows how to negotiate. Google’s acquisition price comes out to a 60% premium measured against the company’s stock price. Moreover, the proposed deal includes a $2.5 billion breakup fee Google would owe to Motorola should the deal fall through for whatever reason.
Motorola was desperate to sell and Google was desperate to buy. A match made in heaven, sort of.
That does, however, remind us of a choice Simpsons quote from the episode titled “Burns Verkaufen der Kraftwerk” where the Germans purchase Mr. Burns’ Nuclear Power Plant.
Mr. Burns: [begging] Please sell me my plant back. I’ll pay anything.
Horst: Isn’t this a happy coincidence! You are desperate to buy, and we
are desperate to sell.
Mr. Burns: [calculatingly] Desperate, eh? … Advantage: Burns!