Lockheed Martin acquires Savi Technology

By Staff -- Modern Materials Handling, 6/1/2006

Defense contractor Lockheed Martin has announced plans to acquire RFID solutions provider Savi Technology. The deal is expected to close by the end of this month.

California-based Savi is a provider of active RFID tags, readers and software. The U.S. Department of Defense is one of the company's biggest customers.

This acquisition is a major step forward for the RFID industry, says Andrew Nathanson, an analyst with Venture Development Corp.

Lockheed's investment, he says, is a sign that RFID is a maturing industry, and attention from a company like Lockheed may attract other investors to the field.

With Lockheed's deep pockets to draw from, Savi will likely increase its research and development budgets. "We're expecting Savi to be able to come down in pricing and experience some significant innovation," Nathanson says.

"It's also important to note that this deal is not financially motivated," he says. Savi agreed to Lockheed's offer not because the company needed cash but because the two companies fit together so well. "The synergy between these two companies is incredible," he says.