Arris Group closed its $2.35 billion acquisition of Motorola Mobility’s Home unit from Google Wednesday morning, sealing up a deal that will make Arris the nation’s largest set-top supplier and put it in position to compete more directly with Cisco Systems.
Arris paid Google about $2.2 billion in cash and issued Google 10.6 million shares of its common stock in connection with the deal. Part of the deal was funded through the sale of 10.6 million shares to Comcast, Arris’s largest customer. As a result, Google and Comcast now each hold 7.7 percent stakes in Arris, but do not have board seats.
Arris intends to announce the new leadership structure of the newly combined company on Thursday, April, 18, Arris chairman and CEO Bob Stanzione told Multichannel News, in an interview. Former Charter Communications CTO Marwan Fawaz has led Horsham, Pa.-based Motorola Home since June 2012.
Wednesday’s close comes about four days after the U.S. Department of Justice cleared the deal, which was announced on Dec. 19, 2012. At the time, Arris estimated that the combined company would generate annual cost synergies in the range of $100 million to $125 million.
From the start, Arris has stressed that the acquisition of Motorola Home would be “transformative” for the company, enabling it to establish itself as an end-to-end supplier of broadband and video equipment for a more diverse set of service providers.
“This acquisition creates a global player in video delivery and broadband technology. We are combining the industry’s top experts and technologies to create a powerful solution for the entire multiscreen delivery chain – from network infrastructure, to transport, to user experience,” Stanzione said, in a statement. “The new Arris has the expertise to transform the industry.”
Evercore Partners acted as the lead financial advisor, with Troutman Sanders acting as lead legal counsel to Arris on the transaction. Bank of America Merrill Lynch also advised Arris. Barclays was the financial advisor and Cleary Gottlieb Steen & Hamilton LLP acted as legal counsel to Google. RBC Capital Markets acted as joint lead arranger, joint bookrunner and syndication agent in financing for the transaction.