Google mobilises in support of Android

In its biggest deal to date, Google said it would pay $40 per share in cash, a 63 per cent premium to Motorola Mobility’s Friday closing price on the New York Stock Exchange.

“What it says is that Google wants to provide a total experience that’s hardware and software (like Apple),” said BGC Partners analyst Colin Gillis.

Google, maker of the Android mobile phone operating system software, has been forging ahead in the smartphone market but has been hampered by a lack of intellectual property in wireless telephony.

Earlier this month, fresh from losing a bid to buy thousands of patents from bankrupt Nortel, Google chief legal officer David Drummond blasted Microsoft, Apple, Oracle and “other companies”, accusing them of colluding to hamper the increasingly popular Android software by buying up patents.

A source close to the deal said Google swooped in to buy Motorola Mobility after losing out on Nortel’s patents.

“It is much more than just a patent sale. It is obviously more than a strategy shift for Google that is very significant,” the source said.

Google, which plans to run Motorola Mobility as a separate business, said the deal will close by the end of 2011 or early in 2012.