LG Refutes Rumors of Google Buyout that Sent Stock Soaring

[dgstorm]

It just goes to show how much power a few words across the web can have. A crazy rumor hit early this morning suggesting that Google would be performing a partial buyout of LG stock. Supposedly Google was planning to invest a massive $2.2 billion in LG Electronics, which would have been a 34% stake in the company.

The rumor sent the stock soaring 14%. Unfortunately for anyone who didn't sell in the upswing at the right time, the rumor turned out to be false and the stock dropped back down. This was after LG officially issued a statement refuting the rumor. LG spokesman Ken Hong called the rumor “complete speculation."

Considering how many devices LG has made for Google, the idea wasn't completely ridiculous, which is why the rumor made it to several big name news publications like Reuters, CNBC and the Korean Herald. It still seemed a bit fishy. The way Google dumped Motorola as quickly as possible after buying it, seemed to indicate they have little interest in owning the hardware aspects of mobile.

What do you guys think of this if it had turned out to be true?

 

[Jonny Kansas]

Having what I'd assume is a controlling stake in a company is far different than owning it outright. I also agree with your sentiment Google doesn't want to be manufacturing phones or over a company that's doing the same. That's a smart decision on their end if you ask me. Hard to be accused of playing favorites or being anti-competitive if you don't have a horse in the race.

I haven't had an LG phone since back in the flip phone days, but I've heard and seen plenty of great things they're doing with their devices, so I think a partnership would turn out good for the consumer, but, as I said above, I can see why they wouldn't want to do so.

 

[cr6]

Having what I'd assume is a controlling stake in a company is far different than owning it outright. I also agree with your sentiment Google doesn't want to be manufacturing phones or over a company that's doing the same.

I certainly don't think it's out of the realm of possibilities. Afterall, they've already started their wireless network with Project Fi, why not go "all in"?
It wouldn't surprise me if it eventually happened.

S5 tap'n

 

[Jonny Kansas]

I think the nature of android being open source and used by so many oems will hold them back longer than you think. I was just reading an interesting article this morning about Apple Music. Apparently, Apple charges a 30% fee to subscription services when bought through their iaps, which they require. To the point where Spotify has allegedly sent out emails to their ios customers explaining that they can circumvent this by going to Spotify's website to sign up. Otherwise, they have to pay an extra $3 over the regular price for the subscription through Apple's iaps to make up for Apple's 30% charge. Their terms also won't allow a free trial. And don't allow "family plans."

Now, we all know that Apple Music has a free trial and obviously they're priced for not having to pay that additional 30% as well as having a family plan option, so the FTC is investigating them because this policy is seen as being anti-competitive. Third-party music streaming can't compete with Apple Music with these rules in place.

Wasn't a big deal until Apple launched their own streaming service. Similar policies govern newspaper and magazine subscriptions, but Apple doesn't offer their own alternative in those realms.

Though not exactly the same animal, I don't see how Google could have a large stake in one oem and not face similar claims of not being fair in the way they do things without REALLY covering their backsides. Just my 2 cents, but I'd like to think that Big G is a bit smarter than that, especially with what's going on with their competition.

 

[94lt1]

Let's see..they'll get the patents they need...keep em for a few years and send em packing..if it does happen...

 

[Jonny Kansas]

This is different from owning them outright like they did Moto. At best, they might have some say in what LG does, but they'd only be majority share-holders. That's a different ballgame imo.

 

[94lt1]

I don't see what could've changed..now if it were to happen..other companies would say they're partial to lg..when they never showed anything of the sort to Motorola... It doesn't make sense...why own one to sell it off cheap..to possibly partially buy into one like LG? I would've sold off partial ownership of Motorola if I wanted that ..who knows..I'm probably not seeing the big picture...

 

[Jonny Kansas]

There's always a bigger picture, isn't there?

 

[xeene]

Google wants to penetrate smart appliances market.

 

[94lt1]

Google wants to penetrate smart appliances market.

Does anyone else hear their toaster laughing????[emoji15]