Western Atlas Buying Norand to Gain Mobile Computer Share

To increase its stake in the fast-growing market for mobile computers used by FedEx drivers, Nabisco and other corporate giants, Western Atlas Inc. said Wednesday that it will pay $261.3 million in cash for Norand Corp.

Western Atlas’ Seattle-based Intermec division, which accounted for $370 million of the Beverly Hills company’s $2.5 billion in sales last year, will realize most of the transaction’s synergies, the company said. The products of Cedar Rapids, Iowa-based Norand, which include pen-based sub-notebook computers, will bolster Intermec’s line, which includes industrial bar code printers.

“Intermec concentrates on automation on the factory floor, just short of the factory door,” said Dirk Koerber, a spokesman for Western Atlas. “Norand develops systems that continue to track products, from distribution to customer.”

According to analysts, the highly fragmented automated data-collection industry has grown between 12% and 17% over the last several years.

The deal values Norand’s stock at $33.50 a share. News of the buyout sent the price soaring $13.625 to close at $33 on Nasdaq. Western Atlas shares fell $2 to $70.125 on the New York Stock Exchange.

The acquisition, which was approved by both companies’ boards, is expected to be finalized in the next 30 days, according to Jim Harrington, a spokesman for Norand.

The acquisition would enable Western Atlas, which provides seismic data for companies looking for oil and natural gas, to significantly increase its presence in the automated data-collection business. The systems use mobile computers and wireless communication to collect and transmit information. Common applications include hand-held computers used by delivery drivers and rental car agents to process orders and track inventory.

Intermec was “the third-largest in the business,” said Dennis Coleman, an analyst for Chicago-based Duff & Phelps Credit Rating Co. “The combination will make them No. 2 in terms of sales dollars.”