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Google to buy Motorola Mobility for $12.5 billion

Google acquires Motorola's handset division to defend itself against 'patent attacks' from Apple and Microsoft

Google has bought the handset and tablet maker Motorola Mobility for $12.5 billion (£7.7 billion) – giving it a complete hardware company to push its Android operating system.

The deal was announced today (15 August) and was unanimously approved by the boards of both Google and Motorola.

In a statement, Google chief executive Larry Page said the acquisition would ‘supercharge the entire Android ecosystem for the benefit of consumers, partners and developers’.

Page also said that ‘patent attacks’ by Microsoft and Apple on Android were partly a factor for the move.

“Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies.”

Google will fork out $40 a share for Motorola Mobility – a 63% premium over the handset maker’s closing share price on Friday. The takeover is subject to the usual regulatory approvals in the US and Europe and is expected to complete by the end of 2011 or early 2012.

The move will come as a major blow to rival hardware companies like HTC and Samsung who have collaborated closely with Google in the past on Android smartphones. Google has said it will run Motorola Mobility as a separate business but it is inconceivable that the division wouldn’t get exclusive access to new flavours of the Android OS ahead of its rivals.

You can read Google’s full statement on its official blog.