Buyout firm acquiring U.S. Robotics
Platinum Equity, a private equity company owned by billionaire Tom Gores, is acquiring struggling computer modem maker U.S. Robotics Corp. in an all-cash deal, the companies announced Monday.
Platinum Equity's spokesman, Mark Barnhill, confirmed the deal but declined to disclose details. The deal will be finalized within 30 days pending regulatory filings, he said.
U.S. Robotics Chief Executive Joseph J. Hartnett told an interviewer last year he was seeking a buyer willing to pay $30 million to $50 million.
Based in Schaumburg, Ill., U.S. Robotics will keep its current management and structure and be used to acquire other technology companies, said Jim Levitas, Platinum's senior vice president of mergers and acquisitions.
Platinum Equity, which is based in Beverly Hills, has bought up more than 50 businesses in the past decade. It now runs about 22 technology and manufacturing firms that collectively employ 43,000 workers and generate $8 billion in annual revenues.
U.S. Robotics was launched in 1976 by three University of Chicago students in their Skokie, Ill., garage. It was named after the fictional ``greatest company in the known galaxy'' in Isaac Asimov's science fiction novel ``I, Robot.''
The company, which acquired personal digital assistant maker Palm Inc. in 1995, was then purchased in 1997 by 3Com Corp. for $6 billion and spun off in 2000.
In 1997, Xerox sued U.S. Robotics, claiming that the handwriting-recognition technology marketed as Graffiti and used in Palm, Handsprings and other handheld devices infringed a Xerox patent received earlier that year.
U.S. Robotics eventually became the leading seller of dial-up computer modems, but it has struggled in recent years as demand grows for high-speed cable, DSL and wireless computer networking systems.
``The company built their name around modems, but the days of modems are long past,'' said industry analyst Martin Reynolds at Gartner Inc. in San Jose.
U.S. Robotics employs 125 workers and posted 2004 sales of about $150 million.