Acquiring a company does not always mean folding it into the buyer's own products. In general, keeping a business separate can be one way to protect existing relationships.

Google announced that it will acquire Motorola Mobility for $40.00 per share in cash, or a total of about $12.5 billion. The release stated that the transaction was unanimously approved by the boards of directors of both companies.

Running an acquired hardware maker as a separate business

Google Investor Relations stated that Google will run Motorola Mobility as a separate business. The transaction is expected to close by the end of 2011 or early 2012. The release added that Motorola Mobility will remain a licensee of Android and Android will remain open.

Keeping an acquired entity distinct might serve to reassure other hardware partners that the parent company will not immediately favor its new in-house subsidiary. A software platform generally relies on a wide distribution network across multiple independent manufacturers. If those manufacturers suspect the platform owner is building a direct, privileged competitor, they might seek alternative operating systems or develop their own. An explicit commitment to separate operations may help mitigate that risk, preserving the broader ecosystem.

Furthermore, structural isolation may insulate a software-focused parent organization from the vastly different operational realities of physical manufacturing. Hardware requires complex supply chain logistics, global inventory management, and fundamentally different capital allocation models. Mixing those operational models too closely could, in principle, make a software business less efficient.

Perhaps some acquisitions are less about building one unified machine than about holding useful pieces.

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