Barcode printer maker Zebra Technologies will spend $3.45 billion to buy Motorola Solutions enterprise business, which makes rugged mobile computers, tablets and barcode scanners.
Zebra's products help companies such as Amazon track inventory and supply chains; the deal will enhance its portfolio through a range of internet-connected devices.
Zebra's shares fell 11 percent to $60.77 on the Nasdaq on concerns the company's borrowings to fund the deal would be as big as its market value of $3.44 billion as of Monday's close.
It will finance the deal through a combination of $200 million cash on hand and $3.25 billion in debt, comprising a credit facility and issuance of debt securities.
[Related: Lenovo buys Motorola Mobility for $3 billion]
"It's an aggressive play by Zebra to fortify their position in the entire AIDC (automatic identification and data capture) space," Northcoast Research analyst Keith Housum said.
"It's a good long-term play but in the short term, I think it's going to be challenging," Housum said, noting the large debt and the fact that the enterprise business has struggled to grow organically in the past two years.
The business, which accounts for about a third of Motorola Solutions' total revenue, has suffered as clients delay orders and cut spending.
Zebra, however, said it expected the deal to add to earnings immediately after closing at the end of this year.
After the sale, Motorola Solutions will be left with its core government and public safety business. It will also retain its iDEN products portfolio, which is a part of its enterprise business.
"Upon closing of the transaction, we intend to return the proceeds to our shareholders in a timely fashion," Motorola Solutions chief executive Greg Brown said in a statement.
About 4,500 Motorola Solutions' employees will join Zebra's workforce of about 2,600 as of 25 January.
Zebra's rivals in its printing business include Hewlett-Packard, Epson and Lexmark, while Ubisense and AeroScout are among its competitors in the location tracking products business.
In October, Zebra launched Zatar, a web-based software that allows companies to deploy and manage devices and sensors connected to the Internet.
In December, Zebra acquired Hart Systems, which provides web-based inventory management software to the retail industry.
Global merger and acquisition activity has surged this year, mainly in the technology industry. Deals worth about $618.4 billion have been completed, with a third of those in the technology, media and telecom sector, according to Thomson Reuters data.