ZBRA » Topics » Note 4 - Business Combinations

This excerpt taken from the ZBRA 10-Q filed May 8, 2009.

Note 5 – Business Combinations

On April 1, 2008, Zebra acquired all of the outstanding stock of Multispectral Solutions Inc. (MSSI) for $18,366,000, which is net of cash acquired and includes transaction costs. Headquartered in Germantown, Maryland, MSSI is a global provider of ultra wideband (UWB) real-time locating systems and other UWB-based wireless technology. Zebra acquired this company to further extend our range of solutions to help our customers identify, track and manage a broader range of assets. The Consolidated Statements of Earnings reflect the results of operations of MSSI since the effective date of the purchase. The pro forma impact of this acquisition was not significant. This acquisition is included in the Zebra Enterprise Solutions (ZES) business segment.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition.

 

     At April 1, 2008  

Current assets

   $ 700  

Property and equipment

     70  

Intangible assets

     8,000  

Goodwill

     13,547  
        

Total assets acquired

   $ 22,317  
        

Deferred tax liability

     (3,011 )

Current liabilities

     (940 )
        

Net assets acquired

   $ 18,366  
        

The purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $13,547,000. The intangible assets of $8,000,000 consist of the following (in thousands):

 

     Amount    Useful life

Customer relationships

   $ 1,000    10 years

Developed technology

   $ 7,000    8 years

The goodwill is not deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed Oct 31, 2008.

Note 5 – Business Combinations

Multispectral Solutions Inc. On April 1, 2008, Zebra acquired all of the outstanding stock of Multispectral Solutions Inc. (MSSI) for $18,348,000, which is net of cash acquired and includes transaction costs. Headquartered in Germantown, Maryland, MSSI is a global provider of ultra wideband (UWB) real-time locating systems and other UWB-based wireless technology. Zebra acquired this company to further extend our range of solutions to help our customers identify, track and manage a broader range of assets. The consolidated statements of earnings reflect the results of operations of MSSI since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition.

 

     At December 14, 2007  

Current assets

   $ 1,424  

Property and equipment

     70  

Intangible assets

     8,000  

Goodwill

     12,805  
        

Total assets acquired

   $ 22,299  
        

Deferred tax liability

     (3,011 )

Current liabilities

     (940 )
        

Net assets acquired

   $ 18,348  
        

 

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On a preliminary basis pending the receipt of final valuations, the purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $12,805,000. The intangible assets of $8,000,000 consist of the following (in thousands):

 

     Amount    Useful life

Customer relationships

   1,000    10 years

Developed technology

   7,000    8 years

The goodwill is not deductible for tax purposes.

Navis, LLC. On December 14, 2007, Zebra acquired all of the outstanding stock of Navis Holdings, LLC (Navis) for $144,067,000, which is net of cash acquired and includes transaction costs. Headquartered in Oakland, California, Navis provides solutions to optimize the flow of goods through marine terminals and other operations managing cargo in the supply chain. Zebra acquired this company to further extend our range of solutions to help our customers identify, track and manage a broader range of assets. The consolidated statements of earnings reflect the results of operations of Navis since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition.

 

     At December 14, 2007  

Current assets

   $ 26,253  

Property and equipment

     2,601  

Intangible assets

     58,400  

Goodwill

     76,340  
        

Total assets acquired

   $ 163,594  
        

Current liabilities

     (19,527 )
        

Net assets acquired

   $ 144,067  
        

On a preliminary basis pending the receipt of final valuations, the purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $76,340,000. Of this amount, $1,531,000 was added to goodwill as a result of purchase accounting adjustments during 2008. The intangible assets of $58,400,000 consist of the following (in thousands):

 

     Amount    Useful life

Trade names

   $ 2,300    2 years

Customer relationships

     39,000    15 years

Developed technology

     17,100    6 years

The goodwill is deductible for tax purposes.

proveo AG. On July 2, 2007, Zebra acquired all of the outstanding stock of proveo AG for approximately $15,000,000, which is net of cash acquired and transaction costs. This transaction called for potential payments of $5,100,000 in addition to the initial purchase price payment. These payments were contingent upon gross profit of specific products shipped for the first eighteen months after the acquisition. During the third quarter of 2008, the first of these payments was made for $3,738,000 and added to Zebra’s goodwill. One additional and final payment may be made in the fourth quarter of 2008 and would be added to goodwill at that time.

This excerpt taken from the ZBRA 10-Q filed Aug 1, 2008.

Note 5 – Business Combinations

Multispectral Solutions Inc. On April 1, 2008, Zebra acquired all of the outstanding stock of Multispectral Solutions Inc. (MSSI) for $17,987,000, which is net of cash acquired and includes transaction costs. Headquartered in Germantown, Maryland, MSSI is a global provider of ultra wideband (UWB) real-time locating systems and other UWB-based wireless technology. The consolidated statements of earnings reflect the results of operations of MSSI since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition.

 

     At December 14,
2007
 

Current assets

   $ 1,558  

Property and equipment

     58  

Intangible assets

     8,000  

Goodwill

     12,322  
        

Total assets acquired

   $ 21,938  
        

Deferred tax liability

     (3,011 )

Current liabilities

     (940 )
        

Net assets acquired

   $ 17,987  
        

 

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On a preliminary basis pending the receipt of final valuations, the purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $12,322,000. The intangible assets of $8,000,000 consist of the following (in thousands):

 

     Amount    Useful life

Customer relationships

   1,000    10 years

Developed technology

   7,000    8 years

The goodwill is not deductible for tax purposes.

Navis, LLC. On December 14, 2007, Zebra acquired all of the outstanding stock of Navis Holdings, LLC (Navis) for $143,942,000, which is net of cash acquired and includes transaction costs. Headquartered in Oakland, California, Navis provides solutions to optimize the flow of goods through marine terminals and other operations managing cargo in the supply chain. The consolidated statements of earnings reflect the results of operations of Navis since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition.

 

     At December 14,
2007
 

Current assets

   $ 26,124  

Property and equipment

     2,601  

Intangible assets

     58,400  

Goodwill

     76,459  
        

Total assets acquired

   $ 163,584  
        

Current liabilities

     (19,642 )
        

Net assets acquired

   $ 143,942  
        

On a preliminary basis pending the receipt of final valuations, the purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $76,459,000. The intangible assets of $58,400,000 consist of the following (in thousands):

 

     Amount    Useful life

Trade names

   $ 2,300    2 years

Customer relationships

     39,000    15 years

Developed technology

     17,100    6 years

The goodwill is deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed Apr 30, 2008.

Note 5—Business Combinations

Navis, LLC. On December 14, 2007, Zebra acquired all of the outstanding stock of Navis Holdings, LLC (Navis) for $143,942,000, which is net of cash acquired and transaction costs. Headquartered in Oakland, California, Navis provides solutions to optimize the flow of goods through marine terminals and other operations managing cargo in the supply chain. The consolidated statements of earnings reflect the results of operations of Navis since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition.

 

     At December 14, 2007  

Current assets

   $ 26,658  

Property and equipment

     2,807  

Intangible assets

     58,400  

Goodwill

     74,907  
        

Total assets acquired

   $ 162,772  
        

Current liabilities

     (18,830 )
        

Net assets acquired

   $ 143,942  
        

On a preliminary basis pending the receipt of final valuations, the purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $74,907,000. The intangible assets of $58,400,000 consist of the following (in thousands):

 

     Amount    Useful life

Trade names

   $ 2,300    2 years

Customer relationships

     39,000    15 years

Developed technology

     17,100    6 years

The goodwill is deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed Aug 3, 2007.

Note 4 – Business Combinations

WhereNet Corp. On January 25, 2007, Zebra acquired all of the outstanding stock of WhereNet Corp. for $127,426,000, which is net of cash acquired and transaction costs. Headquartered in Santa Clara, CA, WhereNet provides integrated wireless Real Time Locating Systems (RTLS) to companies primarily in the industrial manufacturing, transportation and logistics, and aerospace and defense sectors. The consolidated statements of earnings reflect the results of operations of WhereNet since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

 

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Table of Contents

The following table (in thousands) summarizes the adjusted fair values of the assets acquired and the liabilities assumed at the date of acquisition.

 

     At January 25, 2007  

Current assets

   $ 9,254  

Deferred tax assets

     20,686  

Property and equipment

     360  

Intangible assets

     30,616  

Goodwill

     80,756  
        

Total assets acquired

   $ 141,672  
        

Current liabilities

     (14,246 )
        

Net assets acquired

   $ 127,426  
        

The purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $80,756,000. The future benefit of the acquired net operating loss of $30,513,000 is included in the deferred tax assets. The intangible assets of $30,616,000 consist mainly of the following:

 

     Amount    Useful life

Developed technology

   $ 14,978    6 years

Customer relationships

     12,324    10 years

Backlog

     1,461    1 year

Acquired in-process research and development

     1,853    N/A

The acquired in-process research and development of $1,853,000 was written-off at the date of the acquisition in accordance with FASB Interpretation No. 4, Applicability of FASB Statement No. 2 to Business Combinations Accounted for by the Purchase Method. Acquired in-process technology is stated separately in the operating expense section of the consolidated statements of earnings.

The goodwill is not deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed May 4, 2007.

Note 4 – Business Combinations

WhereNet Corp. On January 25, 2007, Zebra acquired all of the outstanding stock of WhereNet Corp. for $127,200,000, which is net of cash acquired and transaction costs. Headquartered in Santa Clara, CA, WhereNet provides integrated wireless Real Time Locating Systems (RTLS) to companies primarily in the industrial manufacturing, transportation and logistics, and aerospace and defense sectors. The consolidated statements of earnings reflect the results of operations of WhereNet since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition based on preliminary third party valuations. Therefore, the allocation of the purchase price is subject to refinement.

 

     At January 25, 2007  

Current assets

   $ 9,254  

Deferred tax assets

     20,686  

Property and equipment

     360  

Intangible assets

     30,616  

Goodwill

     80,530  
        

Total assets acquired

   $ 141,446  
        

Current liabilities

     (14,246 )
        

Net assets acquired

   $ 127,200  
        

 

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Table of Contents

The purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $80,530,000. A net operating loss of $30,513,000 is included in the deferred tax assets. The intangible assets of $30,616,000 consist mainly of the following:

 

     Amount    Useful life

Developed technology

   $ 14,978    6 years

Customer relationships

     12,324    10 years

Backlog

     1,461    1 year

Acquired in-process research and development

     1,853    N/A

The acquired in-process research and development of $1,853,000 was written-off at the date of the acquisition in accordance with FASB Interpretation No. 4, Applicability of FASB Statement No. 2 to Business Combinations Accounted for by the Purchase Method. Acquired in-process technology is stated separately in the operating expense section of the consolidated statements of earnings.

The goodwill is not deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed Nov 8, 2006.

Note 4 – Business Combinations

Retail Systems International, Inc. On February 11, 2005, Zebra acquired certain assets of Retail Systems International, Inc. (RSI) for $7,797,000. Located in Chula Vista, California, RSI manufactured labels, ribbons, tags and other printed media. The consolidated statements of earnings (loss) reflect the results of operations of RSI since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the adjusted fair values of the assets acquired at the date of purchase.

 

     At February 11, 2005

Inventory

   $ 238

Property and equipment

     469

Intangible assets

     1,073

Goodwill

     6,017
      

Total assets acquired

   $ 7,797
      

The purchase price was allocated to identifiable tangible and intangible assets acquired based on their estimated fair values. The intangible assets of $1,073,000 consist mainly of customer relationships with a useful life of 5 years. The goodwill is fully deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed Aug 7, 2006.

Note 4 – Business Combinations

Retail Systems International, Inc. On February 11, 2005, Zebra acquired certain assets of Retail Systems International, Inc. (RSI) for $7,797,000. Located in Chula Vista, California, RSI manufactured labels, ribbons, tags and other printed media. The consolidated statements of earnings reflect the results of operations of RSI since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the adjusted fair values of the assets acquired at the date of purchase.

 

     At February 11, 2005

Inventory

   $ 238

Property and equipment

     469

Intangible assets

     1,073

Goodwill

     6,017
      

Total assets acquired

   $ 7,797
      

The purchase price was allocated to identifiable tangible and intangible assets acquired based on their estimated fair values. The intangible assets of $1,073,000 consist mainly of customer relationships with a useful life of 5 years. The goodwill is fully deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed May 10, 2006.

Note 4—Business Combinations

Retail Systems International, Inc. On February 11, 2005, Zebra acquired certain assets of Retail Systems International, Inc. (RSI) for $7,797,000. Located in Chula Vista, California, RSI manufactured labels, ribbons, tags and other printed media. The consolidated statements of earnings reflect the results of operations of RSI since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the adjusted fair values of the assets acquired at the date of purchase.

 

     At February 11, 2005

Inventory

   $ 238

Property and equipment

     469

Intangible assets

     1,073

Goodwill

     6,017
      

Total assets acquired

   $ 7,797
      

 

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Table of Contents

The purchase price was allocated to identifiable tangible and intangible assets acquired based on their estimated fair values. The intangible assets of $1,073,000 consist mainly of customer relationships with a useful life of 5 years. The goodwill is fully deductible for tax purposes.

This excerpt taken from the ZBRA 10-Q filed Nov 4, 2005.

Note 4 – Business Combinations

 

Retail Systems International, Inc. On February 11, 2005, Zebra acquired certain assets of Retail Systems International, Inc. (RSI) for $7,657,000. Located in Chula Vista, California, RSI manufactures labels, tags and other printed media. The consolidated statements of earnings reflect the results of operations of RSI since the effective date of the purchase. The pro forma effect of this acquisition was not significant.

 

The following table (in thousands) summarizes the adjusted fair values of the assets acquired at the date of acquisition.

 

 

 

At February 11, 2005

 

Inventory

 

$

238

 

Property and equipment

 

469

 

Intangible assets

 

1,073

 

Goodwill

 

5,877

 

Total assets acquired

 

$

7,657

 

 

The purchase price was allocated to identifiable tangible assets and intangible assets acquired based on their estimated fair values. The intangible assets of $1,073,000 consist mainly of customer relationships with a useful life of 5 years. The goodwill is fully deductible for tax purposes.

 

This excerpt taken from the ZBRA 10-Q filed Aug 4, 2005.

Note 4 – Business Combinations

 

Retail Systems International, Inc. On February 11, 2005, Zebra acquired certain assets of Retail Systems International, Inc. (RSI) for $7,655,000. Located in Chula Vista, California, RSI manufactures labels, ribbons, tags and other printed media. The consolidated statements of earnings reflect the results of operations of RSI since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

 

The following table (in thousands) summarizes the adjusted fair values of the assets acquired at the date of acquisition.

 

 

 

At February 11, 2005

 

Inventory

 

$

238

 

Property and equipment

 

469

 

Intangible assets

 

1,073

 

Goodwill

 

5,875

 

Total assets acquired

 

$

7,655

 

 

The purchase price was allocated to identifiable tangible assets and intangible assets acquired based on their estimated fair values. The intangible assets of $1,073,000 consist mainly of customer relationships with a useful life of 5 years. The goodwill is not deductible for tax purposes.

 

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