Intermec buys competitor Vocollect
Voice solutions provider Intermec purchases Boston-based Mobile technology company Vocollect for US$190 million
January 20, 2011
Voice solutions provider Intermec has purchased Boston-based Mobile technology company Vocollect for US$190 million.
Owned by private equity firm Riverside Partners and investors, Vocollect boasts over 1,500 customers and 300,000 users globally.
"Vocollect will broaden Intermec’s applications and solution offerings in the warehouse workflow and help to establish a leading position in software oriented solutions," says Intermec president and chief executive officer Patrick Byrne.
"The acquisition will also extend Vocollect’s voice solutions into the rapidly growing markets served by Intermec and its channel partners.
"This is a major step for Intermec in building a software-centric solutions business in the warehouse, the largest Automatic Identification and Data Capture (AIDC) deployment environment," Byrne says.
"For many years, Vocollect has built the premier set of voice-centric warehouse solutions and has achieved a strong global market leading position.
"The adoption of voice in the warehouse is developing rapidly and we expect this technology to provide significant long-term growth opportunities for Intermec."
When combined with Intermec’s industry leading products and customer relationships, the Byrne says the acquisition will establish Intermec as a clear market leader in warehouse solutions and give it the talent and technology base for creating unique new market focused solutions in the AIDC industry."
"We are excited about the combination with Intermec," adds Vocollect president and chief executive officer Joe Pajer.
"Working together, we believe we can accelerate the adoption of voice centric solutions on a global basis and create new innovative warehouse solutions capabilities for our customers and partners."
Upon completion of the transaction, Joe Pajer will lead the Intermec Voice Solutions business, reporting to Patrick Byrne
KEY FINANCIAL HIGHLIGHTS
"Intermec expects that its combination with Vocollect will accelerate the Company’s revenue growth above current market growth rate projections," Patrick Byrne says.
"Based on Vocollect’s unaudited financial statements for fiscal 2010, we expect Vocollect’s 2010 revenues will approximate $120 million."
The Vocollect business is expected to deliver double digit future revenue growth.
In fiscal year 2011, upon completion, the transaction is expected to generate annual revenue synergies of approximately $10 million and is expected to be accretive to Intermec’s earnings per share.
TERMS OF AGREEMENT
Under the agreement, Vocollect will be merged with a wholly-owned subsidiary of Intermec.
Vocollect stockholders will receive an aggregate cash purchase price of $190 million, subject to adjustment following closing.
Completion of the transaction, which is expected to close in the first quarter of calendar year 2011, is subject to expiration or termination of the applicable Hart-Scott- Rodino waiting periods, and other regulatory and customary conditions as provided in the merger agreement.
Q4’10 FINANCIAL GUIDANCE REVISION
Revenue for Intermec’s fourth quarter of 2010 is expected to be in the range of $196 million to $199 million, compared to its previously stated guidance of $180 million to $190 million.
Diluted earnings per share is expected to be in the range of $0.10 to $0.12 per diluted share, compared to our previously stated guidance range of $0.04 to $0.09 per diluted share.