Verizon, in Bid to Diversify, Sets$2.4 Billion Deal for Fleetmatics -- WSJ
August 02 2016 - 3:03AM
Dow Jones News
By Joshua Jamerson
Verizon Communications Inc. said Monday that it agreed to
acquire mobile workforce-solutions company Fleetmatics Group PLC
for $2.4 billion, widening Verizon's fleet operations as it looks
to diversify.
The deal, at $60 a share in cash, represents a nearly 40%
premium to Fleetmatics closing price Friday of $42.96.
Shares of Fleetmatics rose 39% to $59.66 in morning trading in
New York and are up 65% in the past three months. Verizon stock, up
20% this year, edged down 0.1% to $55.35.
Fleetmatics' web-based GPS tracking systems allow fleet
operators to monitor vehicle location, fuel usage, speed and
mileage, and other insights into their mobile workforce.
Fleetmatics opened on the New York Stock Exchange in 2012 at
$22.95, up from its $17 offer price. Investors were attracted to
the company because its cloud-computing model made adoption easy
for small-to midsize business without other infrastructure or
sophisticated users.
The Dublin-based company has roughly 737,000 subscribers and
1,200 employees. Its North American headquarters are in Waltham,
Mass.
Last week, Verizon closed its acquisition of mobile enterprise
management software company Telogis Inc.
That transaction, as well as the Fleetmatics deal, came amid
Verizon's bidding for Yahoo Inc., which it last week agreed to buy
for $4.8 billion.
For New York-based Verizon, the Yahoo deal represents a bet that
the troubled web company will give it a leg up as it tries to build
a digital media and advertising empire. Meanwhile, the Fleetmatics
deal reflects its strategy of connecting objects to the internet
wirelessly. Both come as Verizon, the nation's largest U.S.
wireless carrier, is diversifying away from being a telephone and
internet provider.
The Fleetmatics transaction, subject to regulatory approvals and
closing conditions such as the approval of Fleetmatics
shareholders, is expected to close in the fourth quarter.
Write to Joshua Jamerson at joshua.jamerson@wsj.com
(END) Dow Jones Newswires
August 02, 2016 02:48 ET (06:48 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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