AOL Sells 800 Patents To Microsoft In Exchange For Approximately $1.1 Billion
AOL is planning to sell over 800 patents and their related applications to Microsoft in a deal that is valued at $1.056 billion in cash. AOL has said a "significant" portion of the money from the deal will go to shareholders.
The sale is expected to be completed by the end of this year. AOL will keep a patent portfolio of over 300 patents and patent applications in areas such as advertising, search, content generation/management, social networking, mapping, multimedia/streaming and security. In addition, AOL received a perpetual license to the patents being sold to Microsoft.
The deal won't come as a big surprise to anyone who's been following AOL closely over the last few months. Last fall, AOL began looking into ways to unlock the value of its patent portfolio. As Tim Armstrong, AOL's CEO, put it, "This process of unlocking the value of our patent portfolio, that we began last fall, is a significant example of focusing our time and energy around strengthening our company’s balance sheet and unlocking value for our shareholders. Most importantly, this is another step forward for the comeback of AOL and allows us to remain laser-focused on our strategy and future growth. As always, we know that our growth will be driven by the successful execution against our strategy and we will continue to take aggressive steps to move the company forward."