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Google regulatory filings reveal Motorola's worth: IP is nearly half of the company's value


Google's most recent filing to the SEC has revealed how the company came to that $12.4 billion valuation of Motorola. Unsurprisingly, its intellectual property portfolio comprised the bulk of the price -- with Mountain View stumping up $5.5 billion for the "patents and developed technology" owned therein. Larry Page claimed that the deal would "supercharge" the Android ecosystem, which led to the company paying $2.6 billion for goodwill -- which was only expected to arise once the buyout was completed. The company spent $630 million on "net assets," $2.9 billion to buy the phone maker's cash reserves and $730 million on customer relationships. During its most recent earnings call, Google said it had nothing to announce regarding the newest member of the family -- but perhaps we can look forward to some more exciting hardware... pretty please?

"The fair value of assets acquired and liabilities assumed was based upon a preliminary valuation and our estimates and assumptions are subject to change within the measurement period. The primary areas of the purchase price that are not yet finalized are related to certain legal matters, income taxes, and residual goodwill. Of the $12.4 billion total purchase price, $2.9 billion was cash acquired, $5.5 billion was attributed to patents and developed technology, $2.6 billion to goodwill, $730 million to customer relationships, and $670 million to other net assets acquired.

The goodwill of $2.6 billion is primarily attributed to the synergies expected to arise after the acquisition. The amount of goodwill expected to be deductible for tax purposes is zero. "

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