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Arnlea Buys Industrial RFID Line

The acquisition of Indala's unit strengthens the Scottish company's position in oil, natural gas and other markets.
Jul 25, 2002July 25, 2002 -- Arnlea Systems, an Aberdeen, Scotland-based company that provides RFID technology for the oil, natural gas, petrochemical, nuclear and mining industries, has purchased the industrial RFID products and manufacturing capabilities of Indala, a unit of Assa Abloy.

"It gives our company control over our own product line, which is designed for our marketplace," says Jack Clark, Arnlea Systems Limited. "We believe this purchase will allow us to satisfy niche markets currently not addressed by existing RFID technology. It will also ensure continued support for the existing Indala Industrial RFID customer base."

Indala makes a robust RFID tag that can withstand high temperatures, and it makes mobile RFID readers that are intrinsically safe -- that is, they are certified not to cause a spark if they are dropped or broken. IS-certified equipment is required on oilrigs in Europe.

Arnlea had been purchasing button RFID tags and handheld readers and industrial readers from Indala, which was originally a unit of Motorola. Arnlea offers solutions for tracking wireline tools, drill pipe and tubulars, pumps, valves, motors and other heavy equipment.

When Motorola decided to shed its RFID businesses, it discussed selling the unit to Arnlea. But Indala has an access control line of products that Arnlea didn't want.

Motorola wound up selling Indala to Assa Abloy in November 2001, and Indala became part of Assa Abloy's Identification Technology Group. Assa Abloy also owns HID, a large maker or access control systems.

Eight months ago, Arnlea began negotiations with Assa Abloy to buy Indala's industrial RFID products. It made sense for both companies. Assa Abloy's HID unit could focus on its core access control market, while Arnlea continued to develop the industrial identification business.

Under the deal, Arnlea acquires ownership of the patents for Indala's technology and manufacturing capabilities in Mexico, the Philippines, and San Jose, California. Clark says Arnlea will continue to sell tags from other manufacturers, if they meet its customers' needs. He added that his company is very interested in developing a high temperature tag.

Terms of the acquisition were not disclosed.
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