Lenovo has taken over Motorola at a cost of US$2.91 billion. “Lenovo will be able to grow Motorola into a leading manufacturer of devices running on the Android operating system,” said Google on its official website.
Google had acquired Motorola at a price of US$12.5 billion in May 2012 in order to expand its own mobile business, but its sales and popularity failed to live up to expectations. The handover is expected to help Google rationalize its business, while allowing the Chinese PC manufacturer to increase its presence in smartphone markets other than China. At present, Lenovo is the fourth-largest smart phone maker in the world with a market share of 4.8%.
According to foreign news agencies, Google retains most of its patent rights in Motorola in spite of the takeover. US$660 million out of the cost is paid in cash, US$750 million in shares of Lenovo and the rest is paid within three years to come.
Lenovo is expanding its IT business at an aggressive pace by means of M&As. For example, it recently announced that it would acquire the X86 Server, a part of the server business unit of IBM, at US$2.3 billion.
It is planning on joint business with Sony, too. According to Reuters and NHK, the two companies are having discussions to revitalize the VAIO brand, which has suffered losses for years.