NEW HARTFORD — PAR Technology Corp. (NYSE: PAR) is selling its PAR Logistics Management Systems (PAR LMS) shipping asset and management subsidiary to ORBCOMM Inc., a global satellite data-communications company based in Fort Lee, N.J. PAR announced the sale Dec. 28 and said ORBCOMM (NASDAQ: ORBC) will pay $6 million in cash and stock with […]
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NEW HARTFORD — PAR Technology Corp. (NYSE: PAR) is selling its PAR Logistics Management Systems (PAR LMS) shipping asset and management subsidiary to ORBCOMM Inc., a global satellite data-communications company based in Fort Lee, N.J.
PAR announced the sale Dec. 28 and said ORBCOMM (NASDAQ: ORBC) will pay $6 million in cash and stock with the potential of up to an additional $4 million in compensation based on achieving specific sales targets. The deal will close in mid-January.
“The decision to sell PAR LMS resulted from our board’s evaluation over the past year of various strategic alternatives to position the company for long-term growth,” PAR Chairman and CEO Paul B. Domorski said in a news release. “Focusing on the core business will benefit customers and shareholders and the sale of PAR LMS is an important step forward to unlocking the intrinsic value of PAR’s underlying assets.”
ORBCOMM’s experience, technology, and breadth of services will benefit current PAR LMS customers, he added.
“We expect to offer customers increased features, higher levels of integration, and increased scale by adding PAR LMS to our portfolio of leading-edge businesses,” ORBCOMM CEO Marc Eisenberg said. ORBCOMM will add PAR LMS employees to its payroll, he said. The release did not indicate how many employees are affected by the sale, and PAR did not respond to interview inquiries before press time.
The acquisition will add new vertical markets to ORBCOMM and enhance the company’s position in the cold-chain management market, it said. The combined platform supports the company’s growth strategy by expanding its satellite, terrestrial, and dual-mode offerings and will advance sales growth in those business segments, company officials said.
The stocks of the two companies showed differing reactions to the news, with PAR’s share price inching up from $3.70 at the close on Dec. 28 to $3.98 on Jan. 3. ORBCOMM’s stock, on the other hand, initially wavered on Dec. 29, opening at $2.96 and closing at $2.89 before rallying slightly to open and close at $3.03 on Jan. 3. Vincent Colicchio, a senior research analyst with Noble Financial in Boca Raton, Fla., who follows the company, did not respond to inquiries before press time.
ORBCOMM acquired StarTrak in May 2011, also in the transportation-solutions sector.
Raymond James acted as financial advisor to ORBCOMM. Needham & Company, LLC was financial advisor to PAR Technology Corp.
ORBCOMM (www.orbcomm.com), a machine-to-machine data-communications company, has customers including Caterpilar, Inc.; Doosan Infracore America; Hitachi Construction Machinery; and Volvo Construction Equipment. For the third quarter, ORBCOMM reported net income of $555,000 on revenue of $13.9 million.
PAR Technology (www.partech.com) is a provider of restaurant and retail technology including point-of-sale systems and hotel-management systems. PAR reported third-quarter revenue of $59.8 million and net income of $1.2 million. The company, headquartered in New Hartford, also provides computer-based system-design and engineering services to the Department of Defense.