Lenovo closes acquisition of Motorola Mobility from Google

Motorola will continue to operate in Chicago under the leadership of President and Chief Operating Officer Rick Osterloh.

Lenovo said on Thursday that it had closed its acquisition of Motorola Mobility, gaining a larger foothold in the US and other developed markets.

CNET

Under the agreement, Lenovo will pay former parent Google $2.91 billion, including $660 million in cash and $750 million in newly issued Lenovo stock. The remaining $1.5 billion will be paid to Google in the form of a three-year promissory note. While Lenovo gets Motorola's mobile device business, Google keeps the patent portfolio.

The transfer of Motorola to Lenovo from Google marks the end of a short chapter for the storied handset vendor. Credited with the invention of the cellphone, Motorola's brand had taken a hit over the last several years as Apple's iPhone and Samsung rose in prominence. Under Google, Motorola had refined its product portfolio to just a few devices, and developed a focus on the low-end and emerging markets with its affordable Moto G and Moto E smartphones.

Motorola will continue to operate out of Chicago and will still be led by President and Chief Operating Officer Rick Osterloh.

'With an impressive portfolio of smartphones, wearables and PCs, our two companies will be uniquely positioned to push the boundaries of choice and value, and bring exciting new experiences to people everywhere,' Osterloh said in a blog post.

For Lenovo, which has a stronger reputation as the No. 1 PC manufacturer in the world, Motorola lends the company badly needed credibility in the smartphone business. Motorola gives Lenovo a recognizable brand in most developed markets, especially the US, where it also has strong relationships with the wireless carriers.

Liu Jin, executive vice president and president of Lenovo's mobile business group, will serve as chairman of the Motorola Management Board.

Jin said he expects to sell more than 100 million mobile devices this year -- including smartphones and tablets.

'Motorola has already built solid momentum in the market, and their recent results show consumers are excited about their exceptional products that stand out for their design and simplicity,' Jun said.

Motorola over the last two months has unveiled a number of strong products, including a revamped Moto X and Moto G, the Nexus 6 for Google, as well as Tuesday's debut of the Droid Turbo for Verizon Wireless.