[Motorola to buy Kahn's Starfish software company]
SAN FRANCISCO, July 13 (Reuters) - Motorola Inc. said on Monday it has agreed to acquire Starfish Software Inc., a developer of software for wireless devices, in a deal valued at several hundred million dollars.
The deal will be one of Motorola's biggest acquisitions in recent years. The communications and semiconductor giant said that it will take a yet-to-be determined charge in its third quarter. The acquisition is expected to close in September.
"We don't have a history of large acquisitions," Bob Growney, president and chief operating officer, told Reuters, at a late evening news conference here to announce the deal.
Starfish, started in 1994 by Borland International Inc. founder Philippe Kahn, is known for creating the shyperinflation, calendar and scheduling software behind REX, a tiny handheld computer. REX is a credit-card sized device made by Citizen Watch Co. in Japan and sold under the Rolodex brand by Franklin Electronic Publishers.
Starfish's TrueSync technology lets a user enter information once on any device and download it or transfer this data, such as a calendar, addresses, notes and other data, to synchronize with data in other devices or a personal computer.
The Rex is an electronic calendar and address book and competes directly with the more expensive Palm Pilot from 3Com Corp. The Rex's synchronization software works with Microsoft Corp.'s Outlook 98 and with Windows CE and will also connect with the Palm Pilot in the future.
Kahn, chairman and chief executive of Starfish, will join Motorola as president of Starfish, which will operate as an independent subsidiary and remain based in Scotts Valley, Calif. Last October, Schaumburg, Ill.-based Motorola made an undisclosed investment in the software company.
With Starfish's TrueSync, Motorola plans a new generation of wireless devices that exchange information with each other and with other information sources such as personal computers, the Internet and wireless service providers.
"We have been talking about a new Motorola," Growney said on Monday. "This is the new Motorola."
The communications giant has been struggling with its core businesses and recently announced a reorganization to refocus, consolidate and trim costs, including cutting 15,000 jobs.
"There is this really strong shared vision of an opportunity for the future," said Growney, who added that Motorola only entered into talks to buy Starfish about 30 days ago.
Motorola said new cell phones with TrueSynch technology will come out in about six to seven months, but executives declined to discuss other future products, citing competitive reasons.
"There are so many things we can do," said Kahn. "There are a lot of things that will be what Rex was a year ago ... The market channels within Motorola are huge."
Kahn, a French mathematician known to be an outspoken and sometimes flamboyant personality in the PC industry, will report to Motorola senior management. Motorola said Starfish will remain autonomous and that Kahn will participate in guiding Motorola's future technology strategies.
"This is not just a deal, this is a mission," Kahn said.
The exact value of the deal was not immediately available. Motorla said its third quarter write-down will be for the Starfish research and development and engineering in process.
"Motorola tried to get into PDAs (personal digital assistants) with the (Apple) Newton and the Envoy," said Alan Reiter, president and editor of Alan Reiter's Wireless Internet & Mobile Computing newsletter. "They failed because the software didn't connect with anything. The basis of Starfish is to connect with everything else ... Starfish provides what I think will be the dial tone (for wireless devices)." |
