Estimated read time: 1-2 minutes
This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.
LINCOLNSHIRE, Ill. (AP) — 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 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 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 percent, 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.
Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.