Psion Plc. is planning to use part of its 126.4 million pound ($226.2 million) gain from the sale of its holding in Symbian to finance a buying spree in the areas of mobile hardware, middleware, services and wireless. The company is also planning to expand its operations in radio frequency identification and speech recognition.
The company’s chairman, David Potter, said the company has identified suitable areas in which to seek acquisitions and a number of companies have already been subject to detailed review.
After the sale of its 31% stake in Symbian earlier this year, Psion is now anxious to find new growth areas. In its first half to June 30, net income was boosted by the Symbian sale to 94.3 million pounds ($167.8 million), up from a loss of 9.9 million pounds ($17.8 million) on sales that were flat at 63.4 million pounds ($112.9 million).
Psion is showing concern at the lackluster performance of Teklogix, and chief executive Alistair Crawford is to take over as CEO, while the existing president is leaving as part of a streamlining of the management team.
With Teklogix trailing way behind market leader Symbol Technologies Inc., which had revenue of $1.5 billion last year, and Crawford said he is anxious to build up its sales channels in areas such as retail and health care. He said the company has never exploited the strength of its product range and has only addressed one third of the potential market.
Psion will launch its buying spree under the close gaze of skeptical financial institutions, many of which would prefer the company to return the Symbian cash to shareholders.
The value of the Symbian share sale has already shrunk. Psion will get 93.5 million pounds ($167.4 million) up front with two deferred payments based on the number of Symbian devices sold in 2004 and 2005. Psion has now trimmed back its estimate of what it will receive under the deal to 126.4 million pounds ($226.2 million), compared with its estimate of 135.7 million pounds ($242.9 million) when the deal was originally announced in February.