Lenovo to buy Motorola Mobility from Google for $3.3 billion Lenovo: Acquired Motorola Mobility from Google for $3.3 billion. Lenovo has agreed to acquire Google's Motorola Mobility handset unit for $US2.91 billion ($3.3 billion), as the Chinese PC maker continues a buying spree of US hardware companies. "We will immediately have the opportunity to become a strong global player in the fast-growing mobile space," said Yang Yuanqing, chairman and chief executive of Lenovo. A Google company no more: Motorola Mobility. Google will retain a majority of Motorola Mobility's patent portfolio, with Lenovo receiving a licence to the intellectual property. The deal follows Lenovo's agreement to purchase IBM's low-end server unit for $US2.3 billion earlier this month. In 2004, Lenovo acquired IBM's PC division. The company has been looking to counter falling PC shipments by expanding storage equipment and the servers that run corporate networks. Buying Motorola would give Lenovo a stronger presence in the mobile phone market in the US and Western Europe. Lenovo is the fifth-largest smartphone vendor globally with a range of inexpensive handsets. It has begun to expand into premium smartphones in a bid to challenge Samsung and Apple. In September, the company released the Vibe X, which runs Google Android 4.2 mobile operating system. The sale includes $US1.41 billion in cash and Lenovo stock paid at the close of the deal, with $US1.5 billion to be paid in a three-year promissory note, Google said in a statement and according to filings. Not afraid "They're not afraid of going out there and acquiring brands, especially to help them grow internationally," said Andrew Costello, a principal with IBB Consulting. Google bought the Motorola handset business in 2012 in a $US12.4 billion deal. Buying Motorola pushed the internet search company into hardware after 14 years in which web advertising accounted for almost all of its revenue. It also gave Google ownership of 17,000 patents to protect devices running its Android mobile operating system in legal disputes with competitors. Google later sold part of Motorola, the set-top box business, to Arris Group. "This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere," Google CEO Larry Page wrote in a blog post. This is an important move for Android users everywhere. Revenue drops While Google has invested in Motorola, the unit's revenue has declined. Motorola's third-quarter revenue fell about one third, even as the company began selling Moto X, the first smartphone introduced under the direction of Google's leadership. In November, the company announced it was rolling out the lower-cost Moto G smartphone, aimed at getting customers who can't afford higher-end devices from rivals such as Apple. At the time, Motorola CEO Dennis Woodside had touted the phone as a key to winning market share. "When we looked at the smartphone market, we actually think the industry has really failed 5 billion people," Woodside said. With Moto G, you're going to have consumers who have not had a smartphone before. No bargain? Motorola's patents have also shown signs they weren't a bargain. Google has lost patent cases or were delivered disappointing sums in cases that involved some of the intellectual property. Google had estimated in regulatory filings that $US5.5 billion of the purchase price for Motorola was for patents and developed technology. The deal comes two days after Google signed a patent-licensing agreement with Samsung to share their technologies. The agreement covers existing patents and those filed during the next 10 years. Google reports quarterly earnings on Friday. As recently as October, Page had praised Motorola's progress, pointing to the launch of its high-end Moto X in the third quarter. "Although it's still early days Dennis and the team have already transformed Motorola's product quality," Page said in October. Now they're working to build out marketing and distribution.