With Motorola Acquisition, Zebra Set To Enter Big League

by CXOtoday News Desk    Apr 17, 2014

motorola

What may come as a surprise to many in the tec industry is that printer/bar code maker Zebra Technologies is buying Motorola Solutions’ Enterprise business for $3.5 billion in an all cash deal.

Experts believe this is a major move by the Illinois-headquartered Zebra which was known for its RFID and real-time location solutions. However, on the eve of the acquisition, senior vice president for new growth platforms, Philip Gerskovich told Washington Post that Zebra can now capi­tal­ize on two trends: the Internet of Things, and an increasingly mobile workforce.

After the completion of this acquisition, which is slated sometimes end of 2014, Zebra will enter the segment where Motorola’s Enterprise business competes and strengthen its position in key industries including retail, transportation and logistics, and manufacturing and serve approximately 95% of the Fortune 500, the company said in its statement.

“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, Zebra’s chief executive officer.

He added, “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, with approximately $2.5 billion in sales, continues to show a strong growth in mobile computing and advanced data capture communications technologies and services. Motorola’s business division creates “rugged” scanners and devices — built for use in factories and warehouses, could eventually be integrated with Zebra’s bar codes and sensors. Zebra is also targeting businesses with employees who need to access work-related applications from their smartphones or tablets, often through the Internet cloud.

“Our Enterprise business is an ideal fit for Zebra,” said Greg Brown, Motorola Solutions chairman and CEO. “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.”

About 4,500 employees are expected to join Zebra, once the transaction is completed.

Motorola split in two independent companies Motorola Mobility and Motorola Solutions in 2011. In 2012, Motorola Mobility – the handset business of Motorola – was bought by Google for a whopping $12.5 billion. However, Google failed to turn the fate of Motorola Mobility, and early this year sold the company to Chinese smartphone maker Lenovo for just $2.91 billion.

Although the actual reasons why Zebra sets out to acquire Motorola enterprise business is still unclear, one thing is obvious – the company is now aggressively moving toward big league.

A Forbes report states that this is an action to grow the company by following the trend to “the internet of things” and “mobile” with new solutions that are potential game changers.  And there’s no way you can win unless you’re in the game.  With these acquisitions, there is no doubt that what was mostly a manufacturing focused company – Zebra – is now “in the game” for doing new things with new technologies.”

While decision makers at Zebra Technologies are taking bold action to be the industry game-changing leader, which Forbes report states “even if it means stretching your financials, your management team and the technology”, it needs to be seen how effectively they can stay in the game and take their objectives forward!