Motorola 2009 Annual Report Download - page 132

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The following table summarizes net tangible and intangible assets acquired and the consideration paid for the
acquisitions identified above:
Years Ended December 31 2007
Tangible net assets $83
Goodwill 2,793
Other intangibles 1,315
In-process research and development 95
$4,286
Consideration, net:
Cash $4,286
Stock —
$4,286
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 were
completed through 2008. The average risk adjusted rate used to value these projects was 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 was $1.0 billion at the time of acquisition. 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 $296 million in goodwill,
none of which was expected to be deductible for tax purposes and $158 million in identifiable intangible assets.
The pro forma effects of this acquisition on the Company’s consolidated financial statements were not significant.
Due to changes in software platform strategy, impairment charges of $123 million were recorded for the year
ended December 31, 2008, representing write-downs of: (i) $121 million of intangible assets, primarily relating to
completed technology and other intangibles, and (ii) $2 million of property, plant and equipment.
The results of operations of Good had been included in the Enterprise Mobility Solutions segment in the
Company’s consolidated financial statements subsequent to the date of acquisition. During the year ended
December 31, 2009, the Company completed the sale of Good Technology. For the year ending December 31,
2009, the operating results of this business through the date of its disposition are reported as discontinued
operations in the consolidated financial statements. For all other applicable prior periods, the operating results of
this business have not been reclassified as discontinued operations, since the results are not material to the
Company’s consolidated financial statements.