Taiwan’s struggling smartphone maker, HTC, has announced on Thursday that it was selling part of its smartphone business to US technology giant Google for $1.1 billion.
According to the HTC, the deal includes intellectual property licensing and half of its research staff, or around 2,000 people. The deal is expected to be completed in early 2018 pending regulatory approval.
“For Google, the deal will further strengthen its investment in and commitment to smartphones and its hardware business… it shows that Google sees Taiwan as a key hub for innovative technology,” HTC spokesman Peter Shen told a press conference in Taipei.
He declined to give further details about the deal but stressed that HTC would continue to develop and sell smartphones under its own brand.
Agreement
This agreement also supports HTC’s continued branded smartphone strategy, enabling a more streamlined product portfolio, greater operational efficiency and financial flexibility.
“HTC will continue to have best-in-class engineering talent, which is currently working on the next flagship phone, following the successful launch of the HTC U11 earlier this year.
“HTC will also continue to build the virtual reality ecosystem to grow its VIVE business, while investing in other next-generation technologies, including the Internet of Things, augmented reality and artificial intelligence,” a statement from HTC website reads.
The transaction, which is subject to regulatory approvals and customary closing conditions, is expected to close by early 2018.
Evercore served as financial advisor to HTC and Gibson Dunn and Tsar & Tsai acted as legal counsel. Lazard served as financial advisor to Google and Cleary Gottlieb and Lee & Li acted as legal counsel.
