Update #1 (12.30pm): So it seems the buyout does not mean that Lenovo will get everything under Motorola’s umbrella. Google will still keep what is called a “vast majority” of Motorola patents, as well as the Advanced Technology and Projects division folding it into its Android team. This is the same division that worked on the Project Ara modular smartphone concept. (Source: Engadget)

So in just over a year after their releases, the Moto X and Moto G will now bear the mark of Lenovo…or it might phase out even since Google has sold its recently acquired Motorola Mobility to Lenovo for US$2.91 billion.

For record keeping sake, it has been reported that Google spent US$12.5 billion to purchase Motorola Mobility.

Here is an excerpt from the press release:

Lenovo (HKSE: 992) (ADR: LNVGY) and Google (NASDAQ: GOOG) today have entered into a definitive agreement under which Lenovo plans to acquire the Motorola Mobility smartphone business. With a strong PC business and a fast-growing smartphone business, this agreement will significantly strengthen Lenovo’s position in the smartphone market. In addition, Lenovo will gain a strong market presence in North America and Latin America, as well as a foothold in Western Europe, to complement its strong, fast-growing smartphone business in emerging markets around the world.

The advanced patents and innovations that Motorola owned are the areas that spurred Google to make the purchase. However, it has not done much for the search engine company anyway.

On why Google made the sale, Larry Page, Google CEO, had this to say: “Lenovo has the expertise and track record to scale Motorola Mobility into a major player within the Android ecosystem. This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere.”

Full announcement from Page, excerpt:

…the smartphone market is super competitive, and to thrive it helps to be all-in when it comes to making mobile devices. It’s why we believe that Motorola will be better served by Lenovo—which has a rapidly growing smartphone business and is the largest (and fastest-growing) PC manufacturer in the world. 

It seems Lenovo’s aggressive strategies finally paid off. From signing on Kobe Bryant as an ambassador, to making a bid to acquire BlackBerry last year, which failed since the US government moved to block the purchase, it is very apparent that Lenovo wants to break into the American market in a bad way. Some speculate that with this purchase, it is the very much needed foot in the door it needs.

“The acquisition of such an iconic brand, innovative product portfolio and incredibly talented global team will immediately make Lenovo a strong global competitor in smartphones. We will immediately have the opportunity to become a strong global player in the fast-growing mobile space,” shares Yang Yuanqing, CEO of Lenovo.

It has been reported that the existing management team for Motorola will remain in place as Yang feels the two brands are complimentary and will remain in use where they are already strong.

“A detailed plan will be made after we close the deal,” he adds.

For Motorola, it feels the acquisition will provide it with the rapid growth it had been looking for. “With the recent launches of Moto X and Moto G, we have tremendous momentum right now and Lenovo’s hardware expertise and global reach will only help to accelerate this,” Dennis Woodside, Motorola CEO, notes.

As for why Lenovo acquiring Motorola, Yang reveals he is very confident in the purchase for five key reasons:
– it will immediately make Lenovo a major smartphone company in the US and give it relationships with over 50 wireless carries globally
– Motorola is an established and respected brand
– the deal includes important patents and licenses
– it will help address new markets with a diverse smartphone lineup
-it brings along Motorola’s expertise in mature smartphone markets

The Verge has reported that the Motorola branding will remain as it is more known in the US and in certain major markets. Would that mean Motorola becoming a line of products under Lenovo, like how it re-branded the IBM Thinkpad range? Also, would the purchase mean we get to see Intel powered Moto X devices? The world has to wait and see.

Picture credits and information goes to: TechCrunch and The Verge.