By John Harrington
Date: Friday 15 Jun 2012
Hand-held computing device pioneer Psion is selling out to US telecoms colossus Motorola Solutions.
Motorola Solutions is making an agreed offer of 88p in cash for each Psion share in a deal which values the British mobile computing services company at around £129m.
The 88p a share offer compares very favourably with the closing price of 60.5p for Psion on the day before the bid became public but is a far cry from the £18 or so the shares traded at back in 2000.
Credited by many with creating the whole PDA (personal digital assistant) and smartphone category, Psion's golden years were, unfortunately for the company, in an era when such devices were not so commonplace as they are today.
Its EPOC operating system was a forerunner of the Symbian mobile phone operating system, as used by Nokia when the Finnish company was the top mobile phone producer in the world.
Psion sold its stake in Symbian to Nokia for £93.5m plus two year's worth of royalty payments (at 84p per Symbian licence sale) back in 2004, and has been concentrating of late on the design of rugged mobile computing devices.
Motorola Solutions effectively has acceptances in the bag from shareholders representing around 27.0% of the issued share capital of Psion.
Motorola Solutions expects to realise cost and revenue synergies resulting in margin expansion opportunities and expects the transaction to be accretive to earnings per share on a non-US GAAP (generally accepted accounting principles) basis in the first full year following completion and on a US GAAP basis in the second full year following completion of the takeover.
"Psion is a compelling opportunity to strengthen our industry-leading, mobile-computing portfolio with ruggedised hand-held products and vehicle-mount terminals that will deepen our presence in the global markets in which we compete," said Gregory Brown, Chairman and Chief Executive of Motorola Solutions.
Hinting at the supply issues Psion has recently experienced as a small player with limited clout, Psion's Chairman, John Hawkins, said the Offer by Motorola Solutions provides Psion shareholders with "certainty in an environment where certainty is in short supply."
The shares shot up 27p to 87.5p on the bid.
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