NCR, the Duluth technology company, will acquire Alpharetta-based Radiant Systems for $1.2 billion as it considers options for its entertainment business.
The purchase will create a third core market for NCR, in hospitality and specialty retail, and will allow Radiant Systems to expand its business internationally. NCR had previously spoken of entertainment as a possible core market.
NCR chairman and CEO Bill Nuti said in a conference call that the entertainment business -- which includes Blockbuster Express kiosks -- is not as complimentary to NCR's financial and retail business lines as is Radiant Systems. NCR is talking to several interested parties about options for the entertainment division, including partnering with them to run it or selling it, but Nuti would not elaborate about any plans.
Radiant Systems does restaurant and retail point-of-sales and offers software and services for companies such as Chick-fil-A and AMC Entertainment.
"The deal we're announcing today is an unusually good fit for our company," Nuti said. "This is a great acquisition that does a lot of great things for NCR."
The acquisition is likely to add jobs to the area, said Wedbush Securities research analyst Gil Luria.
"It's more about generating incremental growth than cutting costs," he said. "It's a terrific match."
NCR will pay $28 a share for the 26-year-old company, a price that Luria said seemed "about fair." Radiant Systems' stock closed Mondayat $21.45 a share. Its 2010 revenues were $356.5 million; NCR's 2010 revenues were $4.8 billion.
Luria said Radiant Systems had been gaining market share at NCR's expense, and has a comprehensive business and strong technology team.
NCR has been working to offer both software and services, and the acquisition of Radiant Systems will significantly enhance the company, Nuti said. NCR intends to extend Radiant Systems' technologies to fast-growing international markets, and said the $8 billion hospitality and specialty retail markets are under-penetrated by competitors.
Both companies said they expect the transition to be seamless. NCR will finance the purchase with about $1.1 billion of new debt.
NCR employs 21,000 and Radiant Systems has 1,500 employees. The deal is expected to close during the third quarter.
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