The Google Motorola Acquisition: Case Study Of The Google Motorola Acquisition

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The Google Motorola Acquisition
On August 15, Google declared its intentions on procuring Motorola Mobility (MMI), centered in Libertyville, Illinois, for $40 per share or a collective sum of about $12.5 billion. The business deal gave a premium of 63% to the closing price of Motorola Mobility shares on Friday, August 12, 2011. The transaction was approved unanimously by the boards of directors of both companies. The deal resulted from a strenuous effort from Google to obtain regulatory approvals without conditions. It was a Vertical Merger (where companies at different places in a chain of products join together). The Hardware Client (Motorola) was acquired by the Software Client (Google). Google's open-sourced operating system, Android, had recently started
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Apple has come a long way since 1997 when its shares traded at $3.19 and it was nearing bankruptcy. Apple's market cap today is greater than the combined market caps of IBM, Microsoft , Hewlett Packard (HP ) and Dell with about $40 billion in market cap to spare.
From May 3, 2010 through August 1, 2012, Apple's cumulative EPS growth has outgrown the cumulative share price appreciation. This gap is expected to widen over the next twelve months. Apple is slowly transforming into a more conservative and a rather sure investment choice with shareholders seeking a mix of growth and income from their investment choices.
Since November 1, 2010, Apple's share price appreciation on a quarterly basis has fallen behind the rate of growth in earnings per share. While generally speaking, a lagging share price performance relative to earnings growth is not usually a welcomed outcome. One would at least want the share price growth to be in accordance with the earnings growth indicating strong market presence. However with the Apple iPhone to be launched soon, it provided the support for the share price as Apple's overall market cap continued to rise at a higher

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