Numerex has agreed a $37.5 million takeover of fleet-management specialist Omnilink Systems aimed at expanding its product portfolio and boosting its recurring service revenues.
Numerex (Atlanta, GA, USA) said it would fund the transaction through a mixture of cash on hand and a $25 million term loan and expects the deal to close within 30 days.
In a statement, it said it expected the transaction to be accretive to earnings in 2014 and beyond, and to significantly improve its competitive position while opening up “synergistic growth opportunities” in commercial, government and consumer markets.
Numerex said it would provide further information on the impact of the deal on its business during its forthcoming earnings call.
Omnilink (Alpharetta, GA, USA) provides a range of electronic monitoring, asset tracking and personal tracking products and is increasingly offering these on a software-as-a-service (SaaS) basis.
For the 2013 calendar year, the company said that $11 million of its $13 million in revenues were generated from SaaS-based activities.
“We are very pleased to be part of Numerex, a company well-regarded for delivering interactive and on-demand M2M products and services along with innovative enterprise solutions, and that shares our core belief that M2M technology can change the world that we live in,” said Kelly Gay, Omnilink’s president and chief executive. “We couldn’t be more excited to be part of the Numerex family and work with some of the best M2M technology leaders in the world.”
Welcoming Gay to the Numerex “family”, Stratton Nicolaides, Numerex’s chief executive and chairman, said the company would take advantage of Omnilink’s platform, technology, expertise and relationships to expand its presence in existing and adjacent markets.
“We see the combination of Omnilink and Numerex as unique in that it creates significant growth opportunities through product enhancement and channel expansion,” he added. “We expect this transaction will strengthen our development roadmap in key enterprise verticals and will serve as a foundational step in our long-term growth strategy to be the market leader in select M2M solutions.”