In the second telematics deal today, Micronet Enertec Technologies Inc. announced that it has entered into an agreement to acquire the Telematics business of Wireless Novatel Wireless Inc. The assets to be acquired include a complete portfolio of vehicle mounted telematics products along with associated inventory, intellectual property, and customer base. The Telematics business serves customers in various markets including government and police agencies. Revenue in 2015 was approximately $22 million and is expected to grow by 20 percent in 2016 with EBITDA margins of approximately 18 percent.
The total consideration is $24 million comprised of $12M paid at closing and two payments of $6 million on each of the first two anniversaries of the closing date. In addition, the two companies will enter into a manufacturing and supply agreement whereby Novatel Wireless commits to purchase telematics products from Micronet Enertec for a period of at least three years. The deal is expected to closed by the end of the first quarter.
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