Motorola is now a Lenovo company: $2.9 billion acquisition complete (Updated)

Update: In a blog post titled “Hello, Lenovo” Motorola had this to say about its new status:

As excited as we are about what’s changing, we’re also pleased with what we are carrying forward with us. We will be a wholly owned subsidiary of Lenovo and remain headquartered in Chicago’s Merchandise Mart while maintaining offices around the world, including in Silicon Valley. The iconic Motorola brand will continue, as will the Moto and DROID franchises that have propelled our growth over the past year. We will continue to focus on pure Android and fast upgrades, and remain committed to developing technology to solve real consumer problems. And we will continue to develop mobile devices that bring people unprecedented choice, value and quality.

Original post:

Google and Lenovo announced today that the $2.9 billion acquisition of Motorola Mobility has been completed. Starting today, Motorola, the pioneer of mobile phones and one of the most iconic brands in consumer electronics, is a fully owned subsidiary of Lenovo.

Announced on January 29, 2014, the sale sees Lenovo taking over Motorola’s brand and smartphone portfolio, around 3,500 employees (most of them in the US), as well as some of Motorola’s patents and patent licenses. Google, however, will keep “a majority” of Motorola’s patent portfolio. Google paid $12.5 billion for Motorola back in 2011, in a move that most analysts called a patent grab.

Lenovo is paying about $660 million in cash and $1.5 billion in a 3-year promissory note, and Google will also receive shares of Lenovo stock worth approximately $750 million.

Rich Osterloh will continue to lead Motorola as President and CEO, and the company will keep its Chicago headquarters.

“Today we achieved a historic milestone for Lenovo and for Motorola – and together we are ready to compete, grow and win in the global smartphone market. By building a strong number three and a credible challenger to the top two in smartphones, we will give the market something it has needed: choice, competition and a new spark of innovation,” said Yang Yuanqing, chairman and CEO, Lenovo.

Lenovo claims it can bring Motorola back to profit within four to six quarters from the completion of the takeover. With Motorola in the fold, Lenovo hopes to sell 100 million mobile devices this year, for the third place in the market, behind Samsung and Apple.

In the past, Lenovo said Motorola would operate autonomously and that it will be its main presence in the Western markets, where the company still has great brand recognition.