[2016-12-26] Googleplex, Google Headquarters, Mountain View, California. Google logo on the office building is in this photo ()
Cleary Gottlieb Steen & Hamilton is advising Alphabet Inc.’s Google on the $1.1 billion acquisition of Taiwanese smartphone maker HTC Corp.’s Pixel division.
In an all-cash deal announced Thursday, the search engine giant has agreed to acquire a 2,000-employee research and development and a non-exclusive patent license from HTC. The latter’s R&D team—the equivalent of half of HTC’s R&D division—makes the Pixel smartphone that Google launched last year to challenge Apple Inc.’s iPhone.
The deal is Google’s latest effort to develop its own hardware team alongside its Android mobile operating system. In 2012, Cleary Gottlieb advised Google on its $12.5 billion buy of Motorola Mobility, only to sell the business two years later for $2.9 billion to China’s Lenovo Group Ltd.
New York-based Cleary Gottlieb M&A partners Glenn McGrory and Ethan Klingsberg—both of whom are longtime legal advisers to Google, with Klingsberg having taken the lead on a 2015 restructuring that created Alphabet—are advising the company on its purchase of HTC’s Pixel unit.
Other lawyers from Cleary Gottlieb working on the current deal include M&A partner Aaron Meyers, executive compensation partner Michael Albano, intellectual property partner Daniel Ilan and tax partner Corey Goodman in New York, as well as antitrust partner Francisco Enrique González-Díaz in Brussels.
Lee & Li, the largest law firm in Taiwan, is serving as local counsel to Google on the transaction, which is expected to close in early 2018.
HTC has turned to Stewart McDowell, a top female dealmaker and partner at Gibson, Dunn & Crutcher in San Francisco, to handle its part of the deal. Intellectual property partner Brian Buroker in Washington, D.C., antitrust partners Rachel Brass in San Francisco and Ali Nikpay in London, tax partner Jeffrey Trinklein in London and executive compensation partner Sean Feller in Century City are also on the team.
Gibson Dunn is working alongside Tsar & Tsai, a Taiwanese firm advising HTC on local legal matters.
The sale of HTC’s Pixel unit will see the parent company scale back on smartphone manufacturing and concentrate more on virtual reality business. In the early 2010s, HTC was one of the most promising smartphone makers, having made several popular early models that ran on Android software.
But the Taipei-based company’s market share has significantly shrunk recently following the rise of competitors like South Korea’s Samsung Electronics Co. Ltd. and China’s Huawei Technologies Co. Ltd.