Zebra Technologies buying Motorola's enterprise business for $3.45B
In this file photo made Jan. 9, 2010, the Motorola logo is seen at the company's exhibit at the Consumer Electronics Show in Las Vegas. (AP Photo/Paul Sakuma, File)
The Associated Press
Published Tuesday, April 15, 2014 9:38AM EDT
Last Updated Tuesday, April 15, 2014 10:12AM EDT
LINCOLNSHIRE, Ill. -- Zebra Technologies will spend more than $3 billion to buy the enterprise business of Motorola Solutions in a considerable expansion that is both technological and geographical.
The acquisition would broaden the bar-code company's logistics capabilities and create or expand its footprint in more than 100 countries.
Motorola's enterprise business makes hand-held bar code scanners and mobile and tablet computers, among other products. Zebra Technologies Inc. also makes plastic cards and, radio-frequency identification tags.
Motorola Solutions Inc., which is based in Schaumburg, Ill., about 20 miles away from Zebra in Lincolnshire, will continue to make voice and data communication products for government and public safety customers.
Zebra will fund the acquisition with about $200 million in available cash and $3.25 billion in debt. The companies expect to close the deal by the end of the year.
Motorola also released preliminary first-quarter earnings and revenue that missed Wall Street expectations. The company said Tuesday it expects revenue to fall about 9 per cent to around $1.8 billion, due in part to lower-than-expected North American government business. It expects adjusted earnings of 50 cents per share.
Analysts forecast, on average, earnings of 51 cents per share on $1.88 billion in revenue, according to FactSet.
The sale announced Tuesday, however, overshadowed those headwinds and company shares rose more than 3 per cent, to $66.
The company will hold a May 1 conference call to discuss results.
Shares of Zebra fell 56 cents to $6.72 in early trading. Motorola shares fell 31 cents to $63.47.