Google Inc. (GOOG): Arris Group Inc. (ARRS) Buys Motorola Home

Google Inc. (NASDAQ:GOOG) has been making a concerted effort to make Motorola mobility and profitable entity since buying it last spring. Many workers have been laid off and the company has been looking to take Motorola into a different strategic direction to make profitable what was not.

Sergey Brin

And apparently, Google is now deciding to jettison another part of the operation as part of the streamlining process. Though that part is seeming to be a decent windfall for Google Inc. (NASDAQ:GOOG).

Motorola Home, a division of Motorola Mobility that produced set-top boxes for cable providers that are leased to end-users, was sold by Google Inc. (NASDAQ:GOOG) Wednesday to Arris Group Inc. (NASDAQ:ARRS) in a deal valued at about $2.35 billion in cash and stock, a deal Google announced after market hours Wednesday. It was reported that Google had been shopping the Home division of Motorola for several months, with Arris and Pac PLC thought to be the leaders for the prize.

According to the agreement, Google will receive a little more than $2 billion in cash and about $300 million in Arris stock to give Google about a 15% stake in Arris. Arris will also receive licensing access to Motorola Mobility patents, of which there are many. Arris Group provides back-end networking equipment to cable providers, and it is supposed that this new property will allow Arris to provide an expansion of services to have seamless connectivity from the back-end services to the front-end for end-user subscribers with cable companies, who lease the set-top boxes as part of their subscriptions. “The industry faces its biggest technology transformation, and together ARRIS and Motorola will be able to accelerate related innovations such as the introduction of the IP Connected Home environments that service providers need and that their consumers crave,” said Dennis Woodside, Motorola Mobility CEO.

Before this deal, Google Inc. (NASDAQ:GOOG) seemed to have trouble getting rid of Motorola Home, although it was more profitable than Motorola Mobility. Google was reportedly prepared to finance some portion of the buy in order to make it more attractive to potential suitors. Pending regulatory sign-offs, the deal is expected to be closed during the second quarter of 2013, according to reports.