In a move that will seemingly shake up the retail hardware industry, Zebra Technologies has entered a definitive agreement with Motorola Solutions to acquire Motorola’s Enterprise business for $3.45 billion in an all-cash transaction.
The purchase, which was approved by the Zebra and Motorola Boards of Directors, is expected to be finalized by the end of 2014.
“This acquisition will transform Zebra into a leading provider of solutions that deliver greater intelligence and insights into our customers’ enterprises and extended value chains,” said Anders Gustafsson, CEO of Zebra Technologies. “The Enterprise business will generate significant value for our shareholders by driving further product innovation and deeper engagement with our customers and partners. It positions Zebra as a leading technology innovator, with the accelerating convergence of mobility, data analytics and cloud computing.”
Motorola’s Enterprise business offers mobile computing and advanced data capture communications technologies and services. With the transaction, Zebra will enter into this new segment, and be able to amplify its business in retail, transportation and logistics, and manufacturing. The Motorola Enterprise solutions will add breadth and depth to Zebra’s existing product line, which includes barcode and enterprise printing, asset tracking, Internet of Things solutions, and motion and location sensing.
Zebra also will see significant growth in its geographic reach; the company will have approximately 20,000 channel partners in more than 100 countries once the transaction is complete. The overall business, including Motorola Enterprise, will be worth worth approximately $3.5 billion. Up to 4,500 employees from Motorola Solutions also will join Zebra with the purchase.
“Our Enterprise business is an ideal fit for Zebra,” said Greg Brown, Chairman and CEO of Motorola Solutions. “This transaction will enable us to further sharpen our strategic focus on providing mission-critical solutions for our government and public safety customers. Upon closing of the transaction, we intend to return the proceeds to our shareholders in a timely fashion.”
Motorola Solutions will continue to manufacture, design, integrate and deliver voice and data communication solutions for government and public safety companies worldwide.
Morgan Stanley is serving as financial adviser to Zebra, while Kirkland & Ellis LLP is serving as legal adviser. Goldman, Sachs & Co., and J.P. Morgan Securities LLC are offering financial guidance to Motorola throughout the transaction. Winston & Strawn LLP is serving as legal adviser to Motorola. Wachtell, Lipton, Rosen & Katz is serving as legal adviser to the Motorola Board of Directors.