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Motorola Solutions, Huawei Agree to End Technology Dispute

Motorola Solutions Inc. Chief Executive Officer Greg Brown
Motorola Solutions Inc. Chief Executive Officer Greg Brown. Photographer: Jonathan Fickies/Bloomberg

Motorola Solutions Inc. and Huawei Technologies Co. settled a technology-secrets dispute, allowing the sale of Motorola’s networks unit to Nokia Siemens Networks to proceed.

Motorola Solutions and Huawei will drop lawsuits against each other, with the Chinese company receiving an undisclosed fee for use of its technology, the two companies said in a joint statement today. Motorola also agreed to lower the price Nokia Siemens will pay for the phone-network equipment business to $975 million, from $1.2 billion, Motorola said in a separate regulatory filing. Motorola and Nokia Siemens intend to close the deal on April 29, according to the filing.

“The fact they’re giving us a date and they’re comfortable with it shows it’s probably a done deal,” said Matt Thornton, an analyst with Avian Securities LLC in Boston. He has a “neutral” rating on the stock.

Motorola Solutions had sought an agreement to help close the sale to Nokia Siemens, announced in July. Huawei, China’s biggest maker of telecommunications equipment, sued Motorola and Nokia Siemens in January, saying Motorola hadn’t provided assurances it would prevent disclosures about Huawei technology to Nokia Siemens.

“After reviewing the facts, we decided to resolve these matters and return to our traditional relationship of confidence and trust,” Greg Brown, chief executive officer of Schaumburg, Illinois-based Motorola, said in the statement.

Settlement Terms

As part of the settlement, Huawei will allow Nokia Siemens to receive and use confidential Huawei information to service networks Motorola has deployed.

The reduction in the sale price is “not that significant,” said Avian Securities’ Thornton. Nokia Siemens may have negotiated a lower price if it is covering the costs of the Huawei fee or as compensation for lost revenue because of delays to the deal, he said.

Motorola Solutions spokesman Nick Sweers declined to comment on the reasons for the reduced sale price or how big the Huawei fee is. The terms of the deal are otherwise unchanged, he said, adding that the transaction still needs approval from Chinese regulators.

“This suit was never about Motorola or Nokia Siemens,” said Bill Plummer, Huawei’s Washington-based vice president of external affairs, said in an interview today. “This was about seeking to ensure that our intellectual property rights were protected.”

Motorola Solutions rose 33 cents to $44.18 at 4:01 p.m. in New York Stock Exchange composite trading. The stock has climbed 19 percent this year.

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