The Department of Justice wants more information on Google's (NASDAQ:GOOG) proposed $12.5 billion acquisition of Motorola Mobility (NYSE:MMI), potentially lengthening the government's review of the deal.
In a filing with the Securities and Exchange Commission, Motorola said that both companies had received requests for more information from the Justice Department's antitrust division, and that they "intend to cooperate fully and respond expeditiously." Motorola said the transaction is currently expected to close by the end of 2011 or in early 2012, a target unchanged from when the deal was announced Aug. 15.
"While this means we won't be closing right away, we're confident that the DOJ will conclude that the rapidly growing mobile ecosystem will remain highly competitive after this deal closes," Dennis Woodside, a senior vice president at Google who is responsible for the Motorola integration, wrote in a company blog post. "We'll be working closely and cooperatively with them as they continue their review."
While Google described the request for more information as "routine," the Justice Department makes such requests in only around 4 percent of all transactions, according to AllThingsD. Since the deal was announced, analysts and some industry executives, most notably Nokia (NYSE:NOK) CEO Stephen Elop, have warned that the deal could spell danger for Android licensees if Google grants preferential treatment to Motorola for its mobile software.
Eric Schmidt, Google's executive chairman, recently said that Google bought Motorola for more than just its patent portfolio. "We actually believe that the Motorola team has some amazing products coming. ... We're excited to have the product line, to use the Motorola brand, the product architecture, the engineers," he said.
Google has in its favor the fact that the deal is not technically a "vertical" integration between two companies that directly compete with each other. Additionally, Motorola is no longer a dominant player in the handset market, so Google would not be gaining an unusually large market share if the deal is approved.
- see this SEC filing
- see this Google blog post
- see this WSJ article (sub. req.)
- see this Bloomberg article
- see this AllThingsD article
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