Google: Motorola's patents, tech are worth $5.5 billion
The company paid a total of $12.4 billion in its deal to acquire Motorola Mobility, but the justification for its purchase -- patents and technology -- was worth far less.
Google paid a significant premium to acquire some patents and technology from Motorola Mobility, the company has revealed.
The search giant yesterday filed a document with the Securities and Exchange Commission (SEC) outlining how it valued its $12.4 billion (not $12.5 billion it originally reported) acquisition of Motorola Mobility. Google says that $2.9 billion of the purchase price accounted for Motorola's cash, while $730 million went to customer relationships and $670 million to other net assets.
The largest percentage of Motorola's value, according to Google, was the $5.5 billion in "patents and developed technology." The remaining $2.6 billion went to goodwill, or the company's value above and beyond its assets.
It's the patents and technology that might prove most important to investors. When Google announced plans last year to acquire Motorola, the company made it clear that it was buying up the firm for its portfolio of tens of thousands of patents and patent applications. Given yesterday's report, it appears Google was willing to pay $7 billion more than the patents' value just get its hands on them.
For the first time last week, Google included Motorola's performance in its quarterly financials. The company said that Motorola contributed $1.25 billion in revenue, but the mobile firm reported a $233 million operating loss.
Google hasn't offered much in the way of specifics on how it will use Motorola just yet, saying only that it will announce details on its plans at a later time. The company has said, however, that Motorola will remain independent.