Motorola to lay off 800 more workers

It also reveals risks and costs associated with its proposed acquisition by Google

Motorola Mobility will lay off 800 people, the latest in a string of worker reductions at the handset maker, as it prepares to become part of Google.

The company revealed the move in a filing with the US Securities and Exchange Commission last week.

The 800 people include staff at its mobile device business and its home business, as well as some who perform corporate functions, Motorola said. The company cut more than 3,000 jobs in 2009, around 1,000 in 2010, and has already let go around 700 employees this year.

Motorola also offered a peek at the impact of its proposed deal with Google on its bottom line. Motorola has spent US$9 million on investment bankers and will incur an additional fee of around $42 million when the merger closes. It has also spent $9 million on legal fees and other costs related to the merger.

It has been the subject of 16 class-action complaints from stockholders who are unhappy about the deal. Those disputes have been consolidated and are ongoing.

Motorola continues to expect its acquisition by Google to be completed this year or early next. In the meantime, it said in the filing, the deal has made it harder for it to attract and retain employees who might be uncertain about their role after the merger; intensified litigation over intellectual property; and led to increased competition as other companies look to exploit opportunities related to the merger.

In the same SEC filing, Motorola noted that in June 2010 it settled litigation with another company and came to a licensing agreement that included an upfront payment to Motorola of $175 million. Combined with the value of patents exchanged, Motorola recorded a gain of $228 million in the nine months ending Oct. 2, 2010, related to the agreement.

Motorola didn't name the company, but in June of 2010 it announced it had settled a dispute with RIM. At the time, Motorola said it would receive a payment as well as ongoing royalties.

Last week Motorola reported third-quarter financial results, in what could be its last quarterly earnings report as an independent company. It narrowed its losses to $32 million but did not say if it still expects to be profitable for the full year, as it previously predicted.

Nancy Gohring covers mobile phones and cloud computing for The IDG News Service. Follow Nancy on Twitter at @idgnancy. Nancy's e-mail address is Nancy_Gohring@idg.com

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Tags mobileMotorolabusiness issuesGooglelayoffs

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Nancy Gohring

IDG News Service
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