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Motorola to buy General Instrument

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CIOL Bureau
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Telecommunications giant Motorola said it

will buy General Instrument in an $11 billion stock swap. Under the deal,

each General Instrument share would be exchanged for 0.575 shares of

Motorola. Following the merger, Motorola shareholders will hold

approximately 17 percent of Motorola stock.

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The company said the merger would position it as a leader in providing

converged Internet, telecommunications and entertainment services. The

companies expect to close the deal during the first quarter of next year,

subject to regulatory and shareholder approval. AT&T subsidiary

Liberty Media Group, the largest General Instrument shareholder, has

agreed to vote for the merger.

Motorola is preparing for the convergence of broadband communications,

cable, and entertainment, Executives said. General Instrument, which makes

television set-top boxes, fits in with that strategy.

"This partnership will enable us to expand our portfolio for

network access, delivering next-generation solutions along with 'home

hubs' that will handle high-speed Internet access and video entertainment,

as well as carrier-quality voice services," Motorola Chief Executive

Christopher B. Galvin said.

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