updated 02:55 pm EDT, Fri October 28, 2011
Mosaid bought for 590m by Sterling
A common source of mass patent violation lawsuits, Mosaid, was bought out on Friday by private equity group Sterling Partners. The deal, worth about $590 million Canadian ($594 million US), will see Sterling take on the task of managing 2,000 Nokia patents as well as the others that Mosaid owns. Both Nokia and its new mobile OS partner need to approve the deal, which should close if approved in December of January.
The acquisition of the Ottawa, Canada company was likely made under the threat of a hostile takeover from Mosaid's local neighbor, Wi-LAN. The rival has tried twice to make offers. Wi-LAN had still left an offer on the table, but Mosaid's board was unanimously urging share owners to reject it.
It's unclear what direction Sterling intends to go with Mosaid, which turned to royalties and lawsuits as its main businesses after it couldn't compete based on its chip products. Sterling has mostly relied on businesses with active products and services, such as education, enterprise, and real estate. Senior managing director Chris HoehnSaric said there would be investments to "realize its full potential" but wouldn't elaborate on what that meant.
The merger could lead to a rash of new lawsuits or forced patent deals if Mosaid's direction isn't changed. Mosaid has claimed that everyone using Wi-Fi owes it royalties and has engaged in the common definition of patent trolling, or suing as many large companies as possible with the aim of getting cash settlements or damages. [via Reuters]