July 6, 2016 — Verizon Telematics, whose “hum” consumer vehicle connectivity business contributed 176,000 connected device adds in Q1 of this year, has purchased Telogis, a fleet navigation Software-as-a-Service (SaaS) provider with distribution through Ford, General Motors, Hino, Isuzu, Mack and Volvo’s Class 8 truck unit.
“This unit should serve as a nice complement to VZ’s [consumer vehicle] telematics division,” wrote Jennifer Fritsche, senior analyst, Wells Fargo Securities, wrote. “We believe this acquisition represents an interesting strategic move to ramp up its scale in the telematics space.”
Verizon’s purchase of Telogis will create one of the largest telematics company in the United States and it marks the first time a wireless company has bought a telematics concern, according to Fritzsche.
“But we do not think it will be the last. The telematics industry is highly fragmented with many smaller players funded by venture capital. We expect to see additional consolidation among these players to scale their platforms and appeal to a wider base of customers,” she wrote.
Terms of the transaction have not been disclosed and it is expected to close in the second half of 2016. PJT Partners and Wells Fargo Securities, LLC acted as financial advisors and Debevoise & Plimpton acted as legal advisor to Verizon. Barclays and J.P. Morgan acted as financial advisors and Paul Hastings acted as legal advisor to Telogis.