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Zebra to spend $3.45B on Motorola business

Published: Tuesday, April 15, 2014 4:46 p.m. CDT • Updated: Tuesday, April 15, 2014 11:43 p.m. CDT
Caption
(AP file photo)
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. Motorola’s enterprise business makes hand-held bar code scanners and mobile and tablet computers, among other products.
Caption
(AP file photo)
Kenneth Ratton of Radiant RFID holds a barcode scanner made by Motorola. Motorola’s enterprise business makes hand-held bar code scanners and mobile and tablet computers, among other products.

LINCOLNSHIRE – 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, 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 percent 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 a share on $1.88 billion in revenue, according to FactSet.

The sale announced Tuesday, however, overshadowed those headwinds.

Motorola shares fell 41 cents, or less than 1 percent, to $63.37.

The company will host a May 1 conference call to discuss results.

Shares of Zebra fell $6.89 to $61.39, a drop of more than 10 percent.

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