July 27, 2004 - Symbol Technologies Inc. has reached an agreement to acquire Matrics, Inc., a designer and manufacturer of EPC (electronic product code)-compliant radio frequency identification (RFID) systems. The purchase price is $230 million in cash.
"The acquisition of Matrics is a significant step in executing our plan to be a leader in RFID, and expands our offerings in the advanced data capture industry," says William Nuti, Symbol president and CEO. "We believe that in order for RFID to be deployed successfully, it needs to be deployed as a system -- a system that allows customers to capture, move and manage critical information to and from the point of business activity. By incorporating the Matrics EPC-compliant RFID products into Symbol's portfolio of industry leading mobile computing, advanced data capture and wireless technologies, Symbol can help customers in key market segments gain operational efficiencies in their supply chains and realize competitive advantage."
Symbol intends to finance the acquisition with short-term borrowings under a new credit facility and expects to refinance the borrowings in a capital markets equity or equity-linked transaction later this year, market conditions permitting. The acquisition, which is subject to approval under the Hart-Scott-Rodino Antitrust Improvements Act, is expected to close in the third quarter of 2004.
As a result of the acquisition, Symbol expects the dilution to its 2004 earnings per share of recurring operations of Matrics, including costs to finance the transaction, to be in the range of $0.05-$0.06 per diluted share, excluding any non-cash amortization charges of acquired intangibles and any purchase accounting adjustments, yet to be determined. Symbol also expects the dilutive effect to diminish in 2005, subject to timing and market demand for RFID products.