Motorola to buy Symbol Technologies
Motorola announced that it would acquire US-based Symbol Technologies in a $3.9 billion deal. Symbol Technologies makes smart handheld scanners and related equipment. It is the leading maker of bar-code scanners in the world, with 30% market share. The company supplies, for example, of the tablets/bar-code readers that United Parcel Services drivers use to confirm deliveries. Its products are widely used in warehouses as well.
The particular connection with Motorola's current business is the area of wireless devices and RFID (radio frequency identification) devices. RFID is being used more and more for inventory control and retail management. Symbol Technologies has over 40% of the market in RFID readers. Interestingly, Motorola helped define the RFID standard in the early 1990s, but has done little with it since.
Low profit margins and an accounting scandal leading to the departure of executives made Symbol ready for a takeover.
Motorola has restructured itself in recent years. It got out of the semiconductor industry in 2004 with the spinoff of Freescale Semiconductors. The IPO gained Motorola somewhere under $3 billion.
(Freescale just recently announced that it would be taken over by a consortium of private equity funds, including the Blackstone Group, the Carlyle Group, Permira Funds and Texas Pacific Group. The deal, not yet finalized, is for over $17 billion, one of the biggest equity deals ever. Talk about a run-up and bad timing by Motorola!)
Motorola now concentrates on four key areas:
- mobile devices (cell phones, walkie-talkies, and Bluetooth devices)
- connected home solutions (cable boxes, remote controls, DVRs, cable modems, VOIP gateways, cordless phones, home security cameras)
- enterprise solutions (wireless networking for Wi-Fi and Wi-MAX, handheld computers. PDAs, communications software)
- wireless infrastructure (servers, amplifiers, and base stations)
In 2006, Motorola has already made a number of deals. These include:
- acquired Swedish digital set-top maker Kreatel Communications AB
- sold off automotive electronics operations to Germany-based Continental AG for $1 billion, which makes embedded wireless powertrain control, and other electronics
- acquired Orthogon Systems, a UK Wi-FI specialist
- acquired lab operations specializing in acoustical testing from BenQ, a Danish company
- acquired TTP Communications, a UK-based company specializing in wireless technology
- acquired Broadbus Technologies, a US company making on-demand technology for cable TV
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