Google 2013 Annual Report Download - page 82

 GOOGLE INC.
PART II
ITEM8.Notes to Consolidated Financial Statements
 
Acquisition of Nest
InJanuary2014,weenteredintoanagreementtoacquire100%ofNestLabs,Inc.(Nest),acompanywhosemissionistoreinvent
devicesinthehomesuchasthermostatsandsmokealarms,foratotalpurchasepriceof$3.2billionincash,subjecttoadjustments.
Priortothistransaction,wehadanapproximately12%ownershipinterestinNest,whichwasnetagainstthetotalconsideration.
WeexpectthattheacquisitionwillenhanceGoogle’ssuiteofproductsandservicesandallowNesttocontinuetoinnovate
upondevicesinthehome,makingthemmoreuseful,intuitive,andthoughtful,andtoreachmoreusersinmorecountries.The
transactionclosedonFebruary7,2014.
Thistransactionisconsidereda“stepacquisition”underGAAPwherebyourownershipinterestinNestheldbeforetheacquisition
isrequiredtoberemeasuredtofairvalueatthedateoftheacquisition.Thegainasaresultofremeasurementwillbeincluded
in“interestandotherincome,net”onourConsolidatedStatementofIncomeintherstquarterof2014.
Wearecurrentlyintheprocessofvaluingtheassetsacquiredandliabilitiesassumedinthetransaction,anddeterminingthe
fairvalueofourpreviouslyheldownershipinterestattheacquisitiondate.Wewillprovideallrequireddisclosuresuponthe
completionofthevaluationintherstquarterof2014.
Divestiture of Motorola Mobile
OnJanuary29,2014,weenteredintoanagreementwithLenovoGroupLimited(Lenovo)providingforthedispositionofthe
MotorolaMobilesegmentforatotalpurchasepriceofapproximately$2.9billion(subjecttocertainadjustments),including
$1.4billiontobepaidatclose,comprisedof$660millionincashand$750millioninLenovoordinaryshares(subjecttoashare
capandoor).Theremaining$1.5billionwillbepaidintheformofaninterest-free,three-yearprepayablepromissorynote.
WewillmaintainownershipofthevastmajorityoftheMotorolaMobilepatentportfolio,includingcurrentpatentapplications
andinventiondisclosures,whichwillbelicensedbacktoMotorolaMobileforitscontinuedoperations.Lenovowillreceiveover
2,000patentassets,aswellastheMotorolaMobilitybrandandtrademarkportfolio.Additionally,inconnectionwiththesale,we
willindemnifyLenovoforcertainpotentialliabilitiesoftheMotorolaMobilebusiness.Thetransactionissubjecttothesatisfaction
ofregulatoryrequirements,customaryclosingconditionsandanyotherneededapprovalsandisexpectedtoclosein2014.
Asweevaluatetheimpactofthisagreement,weexpectnancialresultsofMotorolaMobilewillbepresentedasnetincome
(loss)fromdiscontinuedoperationsontheConsolidatedStatementofIncomeandassetsandliabilitiesofMotorolaMobiletobe
disposedofwillbepresentedasheldforsaleontheConsolidatedBalanceSheetsbeginningintherstquarterof2014.
Weareintheprocessofevaluatingthetransactionanditsimpactonournancialstatements,includingevaluatingtheresulting
gainorlossthatwillberecognized,basedonallthetermsoftheagreement.Thefollowingtablepresentsourbestestimateofthe
aggregatecarryingamountsofthemajorclassesofassetsandliabilitiesrelatedtotheMotorolaMobilesegmenttobedisposed
ofasofDecember31,2013(inmillions):
Assets:
Cashandcashequivalents $160
Accountsreceivable 783
Inventories 178
Deferredincometaxes,net 241
Prepaidandothercurrentassets 919
Propertyandequipment,net 425
Intangible assets, net 959
Otherassets,non-current 325
Total assets $ 3,990
Liabilities:
Accountspayable $ 1,132
Accruedexpensesandotherliabilities 1,531
Total liabilities $2,663
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