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As Part of Lockheed, Savi Spreads RFID Around NATO

Active RFID solutions provider Savi Technology announced a new contract with NATO that could bolster the company's market position among the 26 NATO nations as well as non-NATO countries that are part of the Partnership for Peace initiative. The company was also featured in a recent Forbes article, recapped herein.
Jun 19, 2007This article was originally published by RFID Update.

June 19, 2007—At the 2007 Paris Air Show yesterday, active RFID solutions provider Savi Technology announced a new contract with NATO Maintenance and Supply Agency (NAMSA) that could bolster the company's market position among the 26 NATO nations as well as non-NATO countries that are part of the Partnership for Peace initiative.

The contract means member countries can order Savi solutions through the standard NAMSA procurement protocol, which is a streamlined and centralized process. Savi's defense solutions, which enable visibility of the consignment process for allied militaries, are compliant with certain key NATO standards. By facilitating the purchase of these standards-based solutions, NATO hopes to foster not just consignment visibility but also interoperability among member countries' supply chain systems, who benefit from sharing access to each other's supply chain data.

"The NAMSA contract accelerates the momentum of expanding interoperable RFID-based logistics networks that automatically locate, track, and manage defense supplies while in-transit worldwide," Savi's managing director of international business Bruce Jacquemard was quoted in the announcement.

The contract does not limit the size of orders for Savi solutions made through NAMSA, and it covers a wide range of the company's offering portfolio, including the SmartChain consignment management solution (already in use by a handful of militaries) and starter and evaluation kits.

In addition to the contract with NAMSA, Savi was featured in a recent article by business magazine Forbes. Entitled Savvy Savi Thrives Within Lockheed, the worthwhile article is upbeat on Savi's first year as a subsidiary of giant defense contractor Lockheed Martin, who purchased the company for a reported $400 million last May (see Lockheed Martin to Buy Active RFID Leader Savi).

According to Forbes, Savi appears to have "finally found a good home" at Lockheed Martin. Over Savi's 18-year history, it was acquired by Texas Instruments in 1995, then sold as part of TI's defense-related business to Raytheon. Savi's role within Raytheon, as characterized by Savi cofounder Vikram Verma, was one of irrelevance. Rather than see the company "die a slow death," Verma led a management buyout in 1999 that included RFID hardware manufacturer Intermec as an invester. Capitalized and independent once again, Savi benefited from the US Department of Defense's increasing interest in RFID as well as a post-9/11 focus on cargo security.

Thereafter, the company enjoyed sales flow from both the US military and those of US allies. In 2005 former Secretary of Homeland Security Tom Ridge joined the board (see Tom Ridge Joins Savi Technology Board of Directors). The company's strengthening position caused management to contemplate the next major strategic move. Going public was considered, but being acquired (again) was decided to be more attractive. There were discussions with a number of prospective acquirers, and ultimately the deal with Lockheed was made.

Unlike its earlier experiences within much larger organizations, Savi has retained a lot of autonomy within Lockheed, including funding its own R&D. "Think of it as Lockheed reselling our stuff and making it part of a solution." Forbes quotes Verma. "Our focus is much more on standalone products and services."

Savi's biggest customer remains the US Department of Defense. But the company has growing businesses in the commercial sector as well. Among them is Savi Networks, the shipment visibility joint venture with Hutchison Port Holdings whose deployments have been covered by RFID Update (see Ports in China, U.S. to Pilot RFID Tracking Trade Lane and Metro and Savi Launch Container-Tracking RFID Pilot), is pursuing a worldwide port visibility infrastructure build-out.
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