AOL, New York based Internet Company, is going to sell 800 patents and related applications to Microsoft Corp. costing about $1.056 billion. AOL has sold its patents along with a non-exclusive license to its remaining portfolio of patents. After the deal will be done, AOL will hold around 300 patents including patents of advertising, searching and mapping.
The company has decided this to remain as one of the top Web companies. It has been reported that the company’s revenue has fallen 58% in five years.
The internet company has planned to return a “significant portion of the sale proceeds” to shareholders. Moreover, the company said that it has received a license to the patents being sold to Microsoft.
[hana-code-insert name=’StumbleUpon’ /][hana-code-insert name=’Reddit’ /]“This is a valuable portfolio that we have been following for years and analyzing in detail for several months,” Microsoft’s General Counsel Brad Smith said.
The transaction is expected to be completed by the end of the year 2012. The company has included the sale of an AOL unit in the transaction that the company was expecting to give a capital loss for tax purposes.
AOL has said that if the deal falls, Microsoft will pay $211.2 million to AOL as a termination fee.
Evercore Partners and Goldman Sachs are financial advisors to AOL. Wachtell, Lipton, Rosen & Katz and Finnegan, Henderson, Farabow, Garrett & Dunner are legal counselors.