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Microsoft Aol Technology

Microsoft to agree $1bn deal to acquire AOL patents


By The Drum Team | Editorial

April 9, 2012 | 2 min read

Microsoft is set to agree a deal worth over $1bn to buy most of the patents held by AOL.

The deal, worth $1.056 billion will see AOL sell off over 800 patents to Microsoft, while it also plans to grant a non-exclusive license to the company to its retain parent portfolio.

Over 300 patent and patent applications will still be held by AOL following the sale it added, while the company will also receive a license to the patents being sold.

“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.”

The transaction is forecast to have been completed by the end of 2012.

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