Pace Confirms It Entered Bid For Motorola Mobility's Home UnitArris Also Said to Have Submitted Proposal to Google to Buy Set-Top Group 12/10/2012 8:19 AM Eastern
U.K.-based set-top manufacturer Pace issued a statement Monday confirming that it submitted a proposal to Google to potentially acquire Motorola Mobility’s Home business, while Arris also has reportedly made an offer for the set-top unit.
“Pace confirms that it has submitted an indicative, non-binding, proposal to Google in respect of a potential acquisition of its Motorola Home business,” the company said in a statement announcing the suspension of trading in its shares. “Discussions with Google are currently at a preliminary stage and there is no certainty as to whether any agreement regarding any transaction will be reached.”
Pace did not disclose the financial terms of its offer. The company said that under U.K. financial rules, the potential acquisition of Motorola Home would be classified as a “reverse takeover” given its size relative to Pace and that as a result, the ordinary shares of Pace were suspended from trading on Monday afternoon.
Google had set a Friday, Dec. 7, deadline for bids for the Motorola unit, with the “most compelling” offers coming from Arris and Pace, Bloomberg reported, citing an anonymous source. The bids were expected to be between $1.5 billion and $2.5 billion, and Google indicated it might help finance a deal, The Wall Street Journal reported last week.
Representatives for Google, Motorola and Arris have declined to comment on the matter. Reports surfaced earlier this summer that Google selected Barclays to handle the sale of the cable-focused Home unit.
Pace said trading of its shares will recommence “either on sufficient information on any potential transaction being provided publicly to shareholders, whether in the form of a prospectus or otherwise, or on the release of an announcement confirming that Pace is no longer in discussions with Google regarding the potential acquisition of the Motorola Home business.”
In May, Google closed the $12.4 billion cash acquisition of Motorola Mobility, driven largely by Google's desire to obtain the latter's patents. In August Google announced plans to lay off about 20% of Motorola Mobility's workforce, eliminating about 4,000 jobs, and subsequently said it may make additional cuts.
Google decided to sell the Home group “due to the costs and the fact that cable customers might be leery of doing business with Google,” the WSJ reported.
In June, Google named Marwan Fawaz, formerly chief technology officer of Charter Communications, to run Motorola’s Home group -- a move some observers interpreted as an attempt to reassure MSOs that the business was in good hands. In an interview in October, Fawaz insisted that large cable operators and other service provider customers have not been “distracted” by the Google acquisition.