Web service company AOL, Inc. (AOL: Quote) on Monday said it has entered into a definitive agreement to sell over 800 of its patents and their related patent applications to Microsoft Corp. (MSFT: Quote). The company would also grant Microsoft license to more than 300 additional patents and patent applications. The aggregate proceeds of the deal would be $1.056 billion in cash.
The company expects the deal to be completed by the end of 2012, upon the satisfaction of customary conditions and regulatory approvals.
Following the sale, AOL will continue to hold a significant patent portfolio of over 300 patents and patent applications spanning core and strategic technologies. These include advertising, search, content generation/management, social networking, mapping, multimedia/streaming, and security among others.
AOL also received a license to the patents being sold to Microsoft.
AOL added that its management and its Board of Directors intend to return a significant portion of the sale proceeds to shareholders and will determine the most efficient and effective method to do so prior to the closing of the deal.
Pro forma for the sale and license, as of December 31, 2011, AOL would have had approximately $15 per share of cash on hand, it said.
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by RTT Staff Writer
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