Acquisition of Motorola by the chinese Lenovo

Lenovo
Lenovo

The Chinese electronics company Lenovo Group announced its agreement to acquire the U.S. company Motorola mobile phones from Google for the amount of 2.91 billion dollars. This is the biggest technological agreement has been made by a Chinese company with which the Lenovo gains access to the highly competitive U.S. handset market dominated by Apple. For Lenovo is the second major deal on American soil in a few days, and last week announced that it will buy back electronics company forwarding by IBM from 2.3 billion euros.

Motorola

Motorola

With the sale of Motorola, Google stopped the short lived activity in the manufacturing of mobile devices and marks the retirement of the largest acquisition he had made to date. Note that Google has paid an amount of 12.5 billion dollars for the Motorola 2012. The agreement provides that the giant Internet search company will hold the majority of patents of Motorola.

The agreement must be approved by both the American and the Chinese authorities. Chinese companies have faced the most scrutiny of acquisitions made ​​in the U.S. in 2012, according to a report from the Commission on Foreign Investments in the U.S. last December. Analysts note that political issues can threaten the sale of Motorola, especially since Lenovo will also try to finalize the agreement with IBM. Lenovo will pay for the acquisition of Motorola the amount of 660 million dollars in cash, 750 million dollars in ordinary shares of Lenovo and 1.5 billion dollars in the form of three-year bonds , according to a joint announcement of the Chinese company and Google.

Lenovo

Lenovo

Within two years, the three largest manufacturers of mobile phones in China, the Huawei, the ZTE Corp and Lenovo, have climbed to the top positions on the world market smatrphones, aided partly by the huge domestic market and causing reports of a new power the war of smartphones. While the two other major Chinese company had acquired some access to the U.S., Lenovo was far out of the market of mobile phones. In the third quarter of 2013, ZTE and Huawei were 5.7% and 3% of U.S. sales, respectively, versus 36.2% of Apple and 32.5% of Samsung. Globally, Lenovo ranked fifth in 2013 with a market share of 4.5%, according to the ICD, compared with 3.3% in 2012 and nearly zero two years ago.

By Nicole P.

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