Motorola swoops on symbol

Acquisition of scanning technology company Symbol to boost enterprise business

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By  Published  September 30, 2006

Motorola's acquisition of scanning technology company Symbol will boost its enterprise business Motorola's surprise buy of Symbol Technologies will boost its presence in the enterprise mobility market, executives for both firms claimed last month.

The mobile phone giant has agreed to buy Symbol, best known for its scanning technology, for US$3.9 billion.

Once the deal is completed, Symbol will become a whollyowned subsidiary of Motorola and will form the cornerstone of its Networks and Enterprise business.

“Everything is going digital, and everything digital is going mobile - this is especially evident in the way businesses are run today.

Motorola and Symbol share the same vision of a digital, mobile world for enterprises that matches the world people enjoy at home and at play,” Motorola chairman and CEO, Ed Zander, said.

“This transaction significantly advances Motorola's enterprise mobility strategy and is consistent with our focus on building on our already strong intellectual property portfolio and extending Motorola's seamless mobility leadership,” he added.

“This combination meets our goal of delivering value to our stockholders while creating exciting future growth opportunities for Symbol's associates and partners, and enhanced products and services for our customers,” said Sal Iannuzzi, Symbol Technologies president and CEO.

While Symbol is best known for its barcode scanning products, it also has a wide portfolio of enterprise mobility products, including “rugged” computing devices used by mobile workers, advanced data capture, radio frequency identification (RFID) products, wireless infrastructure and mobility management.

According to Marco Landi, senior director and head of marketing for Symbol Technologies Europe, Middle East and Africa (EMEA), the deal will provide a significant boost to both firms' enterprise efforts.

“We bring to Motorola a full portfolio of products to attack the enterprise opportunities,” he said.

“What they bring to us is the name and branding and economies of scale.”

By working with such a large firm, Symbol can improve in areas such as product development, which would become “much more responsive” he said.

The deal represents a major change in strategy for Motorola, which has made a number of smaller acquisitions in the past year or so to gain traction in higher-margin areas than the mobile phone business, but has not previously taken on such a large purchase.

Since taking the helm of Motorola in 2004, Zander has been widely credited with having revived its fortunes, taking it to number two in the mobile phone market behind leader Nokia.

However Zander, who was previously second in charge at Sun Microsystems, has been keen to increase Motorola's presence in the enterprise market space.

While Landi said that he was not fully up to date on the sales figures, he estimated Motorola's enterprise business to be worth around US$45 million in EMEA and around US$400million in the US.

Symbol would bring US$500 million in the EMEA market and US$1.5 billion in the US, Landi said, giving Motorola a multi-billion dollar enterprise business overnight.

“I think that is a segment where they [Motorola] have tremendous potential for expansion,” he stated.

Landi said he did not expect any significant job cuts as a result of the deal.

Symbol had previously been looking at expanding its Middle East operations, Landi revealed, with the company looking at plans to open an office in Saudi Arabia next year, as well as greater presence in North Africa.

While such plans are now subject to revision, Landi said the company definitely sees the Middle East as a growth opportunity.

Motorola has been making strong progress in the region and appears set to continue.

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