Google is starting to face more scrutiny on its proposed plans to acquire Motorola Mobility, as the Department of Justice recently requested the internet search giant to provide it with more information on the said deal. According to Motorola, the antitrust division of the DoJ has asked it for more information and documentation, while also stating that a similar request has been sent to Google.
According to Google’s senior Vice President, Dennis Woodside, the second request from the department is quite routine and the company has encountered many such things in the past as well. He added that the company is aware that the close watch of the department constitutes the due procedure and it has been in close contact with the Justice Department during the last couple of weeks.
Google, after it announced the plans for taking over Motorola Mobility earlier this year for a fee of $12.5 billion, has expressed its hopes that the deal will be completed before the end of 2011 or early in 2012, even as the merger is facing extreme federal scrutiny. This news has come at a time when the business practices of the company are being closely considered by the Federal Trade Commission of the US and also the EU as both the agencies have accused the company of having favored its own advertisers over other results in its search engine.
The deal with Motorola could be hindered by this increased level of scrutiny if the regulators in the federal agencies come to be concerned that federal antitrust standards would be compromised by Google if it acquires Motorola and its enormous patent portfolio. However, Google has expressed no concerns whatsoever with these possibilities.
Woodgate stated in his blog that even as it could mean that the closing of the deal will face some unexpected delays, the company remains confident that the conclusion of the Justice Department will be favorable to the acquisition as the fast growing mobile market will still be very competitive after the deal.
It has been noted by analysts that uncommonly large acquisition deals such as the bid by AT&T to takeover T-Mobile USA are being increasingly scrutinized of the federal agencies; however, the deal between Motorola and Google might be approved more easily as it is a vertical merger, which means that both the parties are different businesses which exist at different places in the product chain.