Zebra Technologies to buy Motorola's Enterprise business for $3.45B

Zebra Technologies announced on Tuesday that it has entered into an agreement to acquire Motorola Solution’s Enterprise business for $3.45 billion in an all-cash transaction. According to a statement, the acquisition will be funded through a combination of cash on hand and new debt. The transaction, which was approved by the boards of directors of both companies, is expected to be completed 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 Zebra CEO Anders Gustafsson. "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."

"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."

With 2013 pro-forma sales of approximately $2.5 billion (excluding sales of its iDEN products), Motorola's Enterprise business is a provider of mobile computing and advanced data capture communications technologies and services. The acquisition is expected to strengthen Zebra’s position in key industries including retail, transportation & logistics, and manufacturing.

The combined Zebra Technologies with Motorola's Enterprise business would have had pro-forma sales in 2013 of approximately $3.5 billion. Approximately 4,500 employees are expected to join Zebra upon completion of the acquisition. Motorola Solutions will retain its iDEN product portfolio that was part of its Enterprise business and will continue its Government business, including its professional commercial radio product portfolio. Motorola Solutions will also continue to manufacture, design, integrate and deliver  voice and data communication solutions for government and public safety customers worldwide.

In addition, the acquisition will significantly expand Zebra's geographic reach. The combined company will have about 20,000 channel partners in more than 100 countries, and will hold a robust portfolio of intellectual property, with approximately 4,500 U.S. and international patents issued and pending.

"Last year, we undertook a thorough review of our strategy and concluded that the synergies between our Government and Enterprise businesses were not as great as the value we could create by being singularly focused on our core Government & Public Safety business," Brown explained. "Going forward, we will have absolute clarity of purpose and mission as we serve customers globally with our suite of mission-critical communications solutions. This business is truly distinctive in its industry leadership, strong pipeline position, long-term track record of consistent profitability and cash flow, and an array of growth opportunities."