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Google to own $750 million Lenovo stake after Motorola deal closes: HK exchange
[EDIT : Techcrunch removed article, here's another link (thank you w1ntermute) :
http://www.reuters.com/article/2014/02/07/us-google-lenovo-idUSBREA1606B20140207
- msoad 13y agoI'm getting 404 on this link. Did they just pulled the article away?
- mdasen 13y agoNot sure why it's 404'ing, but Reuters is reporting it as well: http://www.reuters.com/article/2014/02/07/us-google-lenovo-idUSBREA1606B20140207 http://www.reuters.com/article/2014/02/07/us-google-lenovo-i...
- alexeichemenda 13y agoYes they did. Don't really know why, but it was fine a couple of minutes ago.
- jeroen 13y agoBecause it was wrong: https://news.ycombinator.com/item?id=7195640 https://news.ycombinator.com/item?id=7195640
- w1ntermute 13y agoHere's another article, since the linked one seems to be down: http://www.reuters.com/article/2014/02/07/us-google-lenovo-idUSBREA1606B20140207 http://www.reuters.com/article/2014/02/07/us-google-lenovo-i...
- alexeichemenda 13y agoThanks, I've changed the link now.
- presty 13y ago"Google paid $750 million for a 5.94% stake in Lenovo Group on Jan. 30, according to a disclosure on the Hong Kong stock exchange. The purchase was made on the same day after Google announced that it had agreed to sell the Motorola brand to Lenovo for $2.91 billion, but will keep most of the handset maker’s patents. The purchase of shares might be part of the deal, in which Lenovo agreed to pay a total of $2.91 billion, with $750 million in Lenovo ordinary shares, $660 million comprised of U.S. cash, and the remaining $1.5 billion in a three-year promissory note. According to one of our sources, Google had wanted to sell Motorola for some time before striking the agreement with Lenovo because the handset brand has yet to live up to its purchase price, but had to hold off on selling the division for tax reasons. On the other hand, buying Motorola helps Lenovo build out its cell phone business. There were rumors in October that it had submitted a bid for BlackBerry, but was turned down."
- wavesounds 13y agoI'm curious, why this isn't insider trading? Edit: I misread the post, they did buy it after the announcement which means it's public knowledge
- Mikeb85 13y agoBecause of this: "The purchase was made on the same day after Google announced that it had agreed to sell the Motorola brand to Lenovo for $2.91 billion" The purchase was made after the announcement. Furthermore, it was part of the Motorola transaction itself, and Google didn't exactly gain anything in the short term (Lenovo shares tanked in the days following the transaction).
- baldfat 13y agoBECAUSE it wasn't a "purchase" this was a very poorly researched article.
- simplezeal 13y agoApple, recently Microsoft and now Google are either making or stake holders in PC manufacturing. So much for post-PC era.
- jonursenbach 13y agoWell Lenovo acquired Motorola off of Google, so Lenovo is technically not just in the PC manufacturing game anymore.
- Mikeb85 13y agoLenovo had a thriving cell phone business already - but it served mainly Asia. Motorola gives them instant access to the NA market...
- nly 13y agoWhat stakes do Microsoft and Apple own in PC manufacturing?
- serge2k 13y agoWell for Apple it would probably be their own PC business. maybe they sold that when I wasn't paying attention.
- nly 13y agoI thought he was implying they had a stake in another non-Mac business. Mentioning Apple otherwise seems odd, seeing as they predate all the other players in the PC space.
- ekianjo 13y agoMicrosoft... like the Surface. Ring any bell?
- nly 13y agoTbh I've never seen a Surface or bothered to look them up. I had assumed these were just branded tablets manufactured by third parties. Looking now, I still don't see why MS are bothering with them exactly, but the consensus seems to be it's only a way to try and bootstrap the Windows tablet market.
- coke 13y agoNo, Google Didn't Just Buy $750 Million Worth of Lenovo Shares: http://on.recode.net/1eDFe17 http://on.recode.net/1eDFe17 via @InaFried
- 001sky 13y ago"Reporting showed that, in fact, Lenovo was merely disclosing what Google might own, should the deal go through" It's not clear if these are options or contingent obligations. If the latter, the original story may be closer to the truth than this "clarification". Either way, its news that was non-obvious from earlier announcements.
- deleted 13y ago[deleted]
- nly 13y agoMakes sense to keep a foot in that door. Lenovo are eating the PC market, and this will also no doubt ensure things like Android, Chromebooks and Google search by default remain on Lenovos agenda.
- RaSoJo 13y agoAre we seeing a thawing of relations between Google and China now?
- netcan 13y agoI'm genuinely confused about large companies constantly "reinvesting" their profits. I understand that a case can often be made for this or that strategic investment and that this is part of complicated maneuvering, paying in stock and such. I just don't understand the value (from a shareholders perspective) of owning share in Google that owns shares in some other company. That aside, why does Google need to own stock in companies? Why not return money to investors and let them buy whatever stock they want.
- bgilroy26 13y agoIt may have been the case that Lenovo could not afford to pay 3B in cash over the next three years. Using their own stock helps them compensate Google for how much they feel Mobility is worth without putting themselves in a tough liquidity position etc.
- netcan 13y agoI get that there are considerations like this. But in that case, would it mean that Google should gradually sell off this stock?
- deelowe 13y agoOnly if they see it as a bad investment or they need cash. Otherwise, it's probably fine to leave it as is and defer the taxes. [EDIT] Oh, and they have a 5% stake in lenovo, which should benefit android and chromeos (and maybe keep MS in check).
- Consultant32452 13y agoLarge corporations hold on to all sorts of assets as investments. This can range from stocks and bonds to real estate or intellectual property. This is very common. Tangentially related to this transaction you may or may not be aware that pretty much any company that funds its own insurance (most large companies) are required by law to hold investments that will help carry them over for any insurance claims. So there is some fund they hold that has stocks, bonds, etc. set aside so that they are covered for insurance claims. The same is true of pension funds.
- neves 13y agoWhat does it means for Moto G (the cheap and good android phone) and Moto X (the Nexus 5 competidor)? Is Google quitting Motorola?
- btian 13y agoGrossly misleading title. The title on Reuters is "Google to own $750 million Lenovo stake after Motorola deal closes: HK exchange", which is what it is.
- alexeichemenda 13y agoThey have changed the title a couple of times, it was not this title when reuters initially published the article.
- pasbesoin 13y agoWell, then, Goog, tell them to fix what they've been doing to their Thinkpad line. Thanks.