U.S. Justice Dept. More Closely Scrutinizes Google-Motorola Deal

By Erin Harrison September 29, 2011

It comes as no surprise that Google is under the microscope of federal justice officials who are more closely reviewing the tech giant’s potential $12.5 billion acquisition of cellphone maker Motorola Mobility.

According to a filing with the U.S. Securities and Exchange Commission, Motorola Mobility Holdings and Google received a request for “additional information and documentary material” from the Antitrust Division of U.S. Department of Justice regarding the proposed merger between the companies.

“The companies intend to cooperate fully and respond expeditiously to the DOJ,” the SEC report said. The transaction is currently expected to close by the end of 2011 or in early 2012, according to the Sept. 28 SEC filing.

The Associated Press reported this week the U.S. Justice Department is “taking a closer look” at Google's proposed acquisition of Motorola Mobility, “raising the hurdle that must be cleared before the deal can be completed,” the report said.

Set to be Google’s biggest acquisition in the last decade, antitrust experts expect regulators to sign off on the Motorola Mobility deal too because there will still be plenty of other mobile phone manufacturers competing in the market, the AP said.

Officials with the Mountain View, Calif.-based company expressed confidence that the Justice Department will view in its favor.

“We're confident that the DOJ will conclude that the rapidly growing mobile ecosystem will remain highly competitive after this (Motorola) deal closes,” Dennis Woodside, a Google senior vice president overseeing the Motorola acquisition, wrote in a Sept. 28 blog post, according to the AP.

Because of Google’s powerful status, the U.S. Justice Department has closely scrutinized the company’s major acquisitions. For example, in April 2011, the Department of Justice ruled that for Google to proceed with its acquisition of ITA Software Inc., Google would have to develop and license travel software, to establish internal firewall procedures and to continue software research and development.

Last month, Google reached a deal to buy Motorola Mobility for about $12.5 billion, or $40 a share – a premium of more than 60 percent to Motorola’s closing price of $24.47, TechZone 360 reported.

If the deal falls through, Motorola will still make out: Google promised to pay Motorola Mobility $2.5 billion if it isn't completed, the AP said.


Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TechZone360, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Rich Steeves

Executive Editor, Strategic Initiatives

SHARE THIS ARTICLE
Related Articles

Why Blockchain Could Be a Gamechanger

By: Paula Bernier    1/22/2018

Blockchain has become closely associated with the controversial topic of cryptocurrency. And that's fine because blockchain is an enabling technology …

Read More

Consumer Privacy in the Digital Era: Three Trends to Watch

By: Special Guest    1/18/2018

Digital advertising has exploded in recent years, with the latest eMarketer data forecasting $83 billion in revenue this year and continued growth on …

Read More

CES 2018: Terabit Fiber - Closer Than We Think

By: Doug Mohney    1/17/2018

One of the biggest challenges for 5G and last mile 10 Gig deployments is not raw data speeds, but middle mile and core networks. The wireless industry…

Read More

10 Benefits of Drone-Based Asset Inspections

By: Frank Segarra    1/15/2018

Although a new and emerging technology, (which is still evolving), in early 2018, most companies are not aware of the possible benefits they can achie…

Read More

VR Could Change Entertainment Forever

By: Special Guest    1/11/2018

VR could change everything from how we play video games to how we interact with our friends and family. VR has the power to change how we consume all …

Read More