Motorola 2007 Annual Report Download - page 125

Download and view the complete annual report

Please find page 125 of the 2007 Motorola annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 146

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146

The following table summarizes net tangible and intangible assets acquired and the consideration paid for the
acquisitions identified above:
Years Ended December 31 2007 2006 2005
Tangible net assets $83$20 $—
Goodwill 2,793 262 —
Other intangibles 1,315 170 —
In-process research and development 95 30 —
$4,286 $482 $—
Consideration, net:
Cash $4,286 $482 $—
Stock ———
$4,286 $482 $—
Symbol Technologies, Inc.
In January 2007, the Company acquired, for $3.5 billion in net cash, the outstanding common stock of
Symbol Technologies, Inc. (“Symbol”), a leader in designing, developing, manufacturing and servicing products
and systems used in end-to-end enterprise mobility solutions featuring rugged mobile computing, advanced data
capture, radio frequency identification (“RFID”), wireless infrastructure and mobility management.
The fair value of acquired in-process research and development was $95 million. The acquired in-process
research and development will have no alternative future uses if the products are not feasible and, as such, costs
were expensed at the date of acquisition. At the date of acquisition, 31 projects were in process and are expected
to be completed through 2008. The average risk adjusted rate used to value these projects is 15-16%. The
allocation of value to in-process research and development was determined using expected future cash flows
discounted at average risk adjusted rates reflecting both technological and market risk as well as the time value of
money.
The fair value of the acquired intangible assets is $1.0 billion. Intangible assets are included in Other assets in
the Company’s consolidated balance sheets. The intangible assets are being amortized over periods ranging from 1
to 8 years on a straight-line basis. The Company recorded $2.3 billion of goodwill, none of which is expected to
be deductible for tax purposes.
The results of the operations of Symbol have been included in the Enterprise Mobility Solutions segment in
the Company’s consolidated financial statements subsequent to the date of acquisition. The pro forma effects of
this acquisition on the Company’s consolidated financial statements were not significant.
Good Technology, Inc.
In January 2007, the Company acquired Good Technology, Inc. (“Good”), a provider of enterprise mobile
computing software and services, for $438 million in net cash. The Company recorded $301 million in goodwill,
none of which is expected to be deductible for tax purposes and $158 million in identifiable intangible assets.
Intangible assets are included in Other assets in the Company’s consolidated balance sheets. The intangible assets
are being amortized over periods ranging from 2 to 10 years on a straight-line basis.
The results of operations of Good have been included in the Enterprise Mobility Solutions segment in the
Company’s consolidated financial statements subsequent to the date of acquisition. The pro forma effects of this
acquisition on the Company’s consolidated financial statements were not significant.
Netopia, Inc.
In February 2007, the Company acquired Netopia, Inc. (“Netopia”), a broadband equipment provider for
DSL customers, which allows for phone, TV and fast Internet connections, for $183 million in net cash. The
Company recorded $122 million in goodwill, none of which is expected to be deductible for tax purposes, and
$100 million in identifiable intangible assets. Intangible assets are included in Other assets in the Company’s
consolidated balance sheets. The intangible assets are being amortized over a period of 7 years on a straight-line
basis.
117