NCR Corporation (NCR) finally wrapped up the acquisition of Radiant Systems Inc., a provider of cash registers and other point-of-sale devices for the retail and hospitality industries, for $1.2 billion in cash.
Alpharetta, Georgia-based Radian develops touch-screen terminals, servers, handheld devices and software to manage operations such as day-to-day transactions, costs and employee management. Its customers include Exxon Mobil (XOM), Kroger (KR) and Nordstrom (JWN).
Radiant System will now be a wholly-owned subsidiary of NCR Corp. The acquisition will help the company tap a lion’s share in the point of sales terminals market. NCR Corp. will also inherit a big customer base, which will provide the company a broader exposure in the retail and hospitality sectors.
NCR Corp. will combine its portfolio of automated checkout products with Radiant’s systems portfolio, which caters to the fast-food and table-service restaurants, specialty and convenience retailers and entertainment venues.
The combined platform will help the company to offer an advanced product portfolio, enabling customers to better achieve long-term growth. The company expects the acquisition to be accretive to adjusted earnings in fiscal year 2012.
We are encouraged by NCR’s second quarter guidance, and believe that the company is well positioned to deliver solid momentum across all its businesses. We appreciate the company’s market leadership, successful acquisitions, product introductions and continued customer wins.
However, we are a bit concerned about its Japan business, which has been hit by the recent natural calamity. Moreover, the restructuring initiatives have begun impacting results.
Currently, NCR Corp. has a Zacks #2 Rank, which translates into a short-term Buy rating.
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