Google and HTC have entered into an agreement where certain HTC employees will join Google. As part of the transaction, HTC will receive $1.1B USD in cash from Google. Google will also receive non-exclusive license for HTC’s intellectual property. HTC says many of the employees worked with Google to develop the Pixel smartphones.

This is seemingly part of the search giant’s new hardware strategy, which is why it ended up acquiring part of another smartphone maker despite having previously acquired and then divested itself of Motorola’s mobile business.

Sources had reported that the reason share trading was halted on September 21 was because of a major pending announcement, and a VentureBeat report included an internal invitation for HTC staff to an all-hands meeting at which the news would be announced.

Media waiting outside during Thursday’s internal announcement at HTC headquarters in Xindian, New Taipei City

HTC has helped create a number of Google devices, and provided the manufacturing for the Pixel smartphone. It also built the last Nexus, the 6P, before Google took over design duties for its own smartphone hardware.

“HTC has been a longtime partner of Google and has created some of the most beautiful, premium devices on the market,” said Rick Osterloh, Senior Vice President of Hardware at Google, in a released statement. “We’re excited and can’t wait to welcome members of the HTC team who will be joining Google to fuel further innovation and future product development in consumer hardware.”

The Taiwanese company has focused increasingly on its emerging VR business, which includes the HTC Vive headset. It continues to make its own smartphones, too, and received some high critical praise for its U11 device this year.

The deal between Google and HTC will see the latter company retain its branding, but Google will take over some of its hardware engineering resources, which should help it own even more of its device-making process. Google had stepped back from in-house hardware after selling its Motorola unit to Lenovo, but recently re-engaged on that front with a different approach focused on premium smartphones, as well as accessories and smart home and connectivity devices like Google WiFi, and Google Home


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