AOL and Microsoft has reached an agreement with in which the software giant will purchase 800 patents from AOL in a $1.056 billion cash deal. Microsoft ill also be given a non-exclusive license to the patent portfolio AOL retains; resulting in proceeds of $1.056 billion in cash. Once the sale is completed, AOL will still hold over 300 patents and patent applications related to advertising, content generation, content management, multimedia and security. Like Yahoo Inc, AOL is an ageing internet giants has failed to produce significant technologies and grow its business.
“The agreement with Microsoft represents the culmination of a robust auction process for our patent portfolio,” said Tim Armstrong, AOL’s Chairman and CEO. “We continue to hold a valuable patent portfolio as highlighted by the license we entered into with Microsoft. The combined sale and licensing arrangement unlocks current dollar value for our shareholders and enables AOL to continue to aggressively execute on our strategy to create long-term shareholder value.”
“This is a valuable portfolio that we have been following for years and analyzing in detail for several months,” said Brad Smith, General Counsel and Executive Vice President, Legal and Corporate Affairs, Microsoft. “AOL ran a competitive auction and by participating, Microsoft was able to achieve our two primary goals: obtaining a durable license to the full AOL portfolio and ownership of certain patents that complement our existing portfolio.”