Motorola Solutions to Sell its Enterprise Division for $3.45 Billion
Published on: 15th Apr 2014
Note -- this news article is more than a year old.
Motorola Solutions has announced that it is selling its Enterprise division to Zebra Technologies in an all cash transaction that values the division at USD3.45 billion.
Zebra Technologies, with 2013 sales of $1 billion, is a provider of barcode and enterprise printing, asset tracking, Internet of Things (IoT) solutions, and motion and location sensing.
Motorola's Enterprise business had sales last year of USD2.5 billion, more than double that of its new owner.
Zebra expects to fund the transaction with approximately $200 million of available cash on hand and $3.25 billion that is fully committed to be raised through a new credit facility and the issuance of debt securities.
"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," stated Anders Gustafsson, Zebra's chief executive officer.
In other news, Motorola Solutions has warned of weaker sales than expected for the first quarter of this year, which it put down to softer demand in the North America Government business along with lower than anticipated Enterprise sales.
First quarter sales are expected to be approximately $1.8 billion, down approximately 9 percent from the first quarter of 2013. Full-year total company 2014 sales are now expected to decline low single digits while operating margins are expected to be comparable to previous guidance. This full-year sales outlook assumes Enterprise growth and a low- to mid-single digit decline for the combined Government and iDEN business.
The company will provide full earnings results on its call, now scheduled for May 1st.
Greg Brown, chairman and CEO of Motorola Solutions, said: "While revenues were less than anticipated in the first quarter, we remain confident that we are well positioned for long-term profitable growth based on our strong pipeline position. We remain committed to our value creation strategy for our shareholders, which combines profitable growth with significant and consistent capital return programs."