Sheehan & Associates, P.L.C.

A look at Google's acquisition successes and failures

Michigan businesses may be interested in a look at the successes and failures of one Silicon Valley company's acquisition strategy. With billions of dollars available to purchase other companies, experts are speculating on what they will acquire next.

Mountain View-based Internet search company Google has made 145 acquisitions in the decade since their initial public offering. While some of these acquisitions have not panned out as financial successes, other have been huge hits. On the negative side, there are companies like Slide, a developer of social applications, that Google purchased for $182 million. Google shut the company down two years after the sale. The acquisition of Motorola for $12 billion only to sell it two years later for $3 billion is seen by some as a failure. However, others argue that the strength of the mobile patent portfolio that Google gained was worth the cost.

Some notable successes for the search giant include the acquisition of YouTube and the Android mobile operating system. This year, Android will be powering 80 percent of smartphones sold, and while Google doesn't make any money from the software itself, the OS is heavily integrated with Google's ecosystem. YouTube is estimated to bring in $5.6 billion in 2013 alone, which more than makes up for the $1.65 billion purchase of the company in 2006. With $61 billion in cash, some believe that Google's next big purchase will target social media.

Complex transactions like these can be difficult to accomplish without the help of an attorney with experience in business and corporate finance. The attorney may be able to assist with mergers and acquisitions or the sale of a business to another owner. The attorney may be useful in performing the necessary due diligence and ensuring that the transaction goes smoothly.

Source: NBR, "Google’s best and worst acquisitions", Josh Lipton, August 19, 2014

Source: NBR, "Google’s best and worst acquisitions", Josh Lipton, August 19, 2014

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