Verizon will buy Fleetmatics Group. It is a GPS vehicle tracking company. Verizon will pay $2.4 billion in cash for the deal. This will help Verizon to expand into the connected vehicle and fleet management market.
Verizon will pay $60 per Fleetmatics share. A premium of about 40 percent to Friday’s close.
Fleetmatics headquarters is in North American in Waltham, Massachusetts. They develop software that shows fleet operators vehicle location, fuel usage, speed and mileage, and other data on their mobile workforce, Verizon said.
Smartphones and mobile devices market are saturating. Verizon and AT&T Inc are hoping that connecting more objects and appliances to their networks will provide new revenue.
Fleetmatics will be a part of Verizon Telematics. It’s a subsidiary of the telco that focuses on fleet management, mobile workforce solutions, and IoT. It’s part of a short spate of acquisitions that Verizon has been making lately to expand those operations. About six weeks ago, Verizon Telematics announced that it would acquire Telogis.
The company is trading publicly since 2012. When it was private, Fleetmatics had raised over $93 million from investors like IVP.
“Fleetmatics is a market leader in North America. They’ve developed a wide-range of compelling SaaS-based products and solutions for small- and medium-sized businesses,” he said in a statement. We will be talking with him later and will ask if there are more deals of this kind to come.
“Verizon and Fleetmatics share a vision. The SaaS-based fleet management solution market is extraordinarily large, lightly penetrated, global and fragmented which can best be attacked together with a world class product offering and the largest distribution channel in the industry,” said Jim Travers, Chairman, and CEO of Fleetmatics, in a statement.
After the acquisition of Yahoo, this is another big acquisition by Verizon. The deal will close in the fourth quarter of 2016. You can check the availability of Verizon Fios Internet plans in your area here.