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Comment by absherwin | Hacker News Reader

They shredded closer to a sixth of the initial price less whatever IP benefit they received.

Motorola had ~$3B in cash when acquired. Google previously sold their set-top box unit for $2.35B and realized about $1.7B in tax benefits from previous losses. However since acquiring it has taken $1.038B in losses, which is $0.67B post-tax. There will be another write down for the lost goodwill less the value of the remaining IP that should be worth very approximately $1B. So including the $3B from Lenovo, they recouped approximately $10.4B of the initial $12.5B purchase price.

Edit: Previous version excluded cash.

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I want to know how long it took you to gather all the figures? and Where you collect them? I am currently working on a platform that help people become better investors. I found your analysis amazingly informative and concise! Thanks!

Quarterly and annual reports. The prospectus for the original sale. These are all public companies so the reports are on record.

Before you start coding or starting a project on this kind of thing please read up on how a company goes public and the reporting requirements and where these things are filed. Also talk to someone in the industry and pick their brain.

I'm in Canada and a requirement for even doing something like business reporting for media is a CSC certificate, which qualifies you for basic knowledge of the securities industry, how to read annual reports and ledgers. Please do the same type of research for the territories and/or countries that you are thinking of working in.

It'll make your projecy more successful.

For example many of these types of documents are filed on sedar in Canada and on Edgar in the us. If these terms don't mean anything to you then you should read up on them.

You should be able to read the 10K and 10Q for such type of information.

You can find 10k and 10q statements through Edgar, in rendered form as well as XBRL documents which describe a hypercube. Warren Buffet also has a good book about how he reads P&L statements.

You have included cash which Motorola had when getting acquired but have conveniently ignored their short term debts (current liabilities) which they were liable to pay. A better number to look at is net working capital.

You're absolutely right that one needs to adjust for short-term liabilities since some of that cash would have gone to pay them (Longer-term liabilities would likely continue on to Lenovo). As big a question in this case is the amount of cash that will be in Motorola when Lenovo acquires it and was in their set-up box business when it was sold.

Unfortunately, the comment isn't editable so I'll add more detail here. The more accurate number is $3.32B in cash and equivalents less ($3.57B in current liabilities - $2.97 in current non-cash assets). This totals $2.72B.

However, I understated the tax benefit. Motorola had a $2.5B reserve against their tax assets since they weren't profitable, which is $0.8B less than my original estimate. So the total error from these two items is an understatement of Google's recoveries by $0.52B, which means they recovered about $10.9B of $12.5B.

Note that there are likely other errors still present in this new calculation due to both lack of information and less than thorough research.

Is any cash / tax benefits being passed over with the business as it's sold?

The other question I suspect is how many, and which, of the patents are being passed over.

Plus I'm sure they will keep the patents, licensing them to Lenovo, or Lenovo will get them and license to Google.

Plus I'm sure they will keep the patents, licensing them to Lenovo

Yes, this was confirmed in today's reportage.

Tim Worstall believes they may have come out ahead on the deal overall: http://www.theregister.co.uk/2014/01/30/google_motorola_mobi...

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