US listed search giant Google has filed a crucial document in relation to the takeover of handset manufacturer Motorola. On the website of the US Securities and Exchange Commission, SEC, the merger agreement between the two companies was published before…
US listed search giant Google has filed a crucial document in relation to the takeover of handset manufacturer Motorola. On the website of the US Securities and Exchange Commission, SEC, the merger agreement between the two companies was published before markets opened in New York this morning.
The filing does include the first on-the-record confirmation that Google would have to pay a US$2.5bn breakup fee if the transaction were to fall apart – a record sum compared to the deal value of US$12.5bn.
It has been pointed out previously that even the US$3bn breakup fee between AT&T and T-Mobile US is smaller in relation to the deal value, considering that AT&T offers to pay US$39bn for its smaller competitor.
The fee is also payable if the merger fails to receive antitrust approval.
The form 8-K filed simultaneously and summarising the merger agreement also highlights that Motorola has no right to solicit other takeover proposals, but the company could still walk if a better unsolicited offer was made by another prospective buyer, subject to a US$375m breakup fee.
The document also confirms that the transaction is conditional upon receiving antitrust clearances from the US, the European Commission and potentially other jurisdictions.
