Mapmaker, Mapmaker, Make Me A Map (And Please Entertain My Takeover Bid)
It's a good time to be a mapmaker. As the digital mapping industry undergoes some serious consolidation with mergers and acquisitions, today Garmin threw a wrench into TomTom's bid for Tele Atlas by offering 15% more. A sign that GPS, LBS, and navigation apps are on the verge of exploding?
It's a good time to be a mapmaker. As the digital mapping industry undergoes some serious consolidation with mergers and acquisitions, today Garmin threw a wrench into TomTom's bid for Tele Atlas by offering 15% more. A sign that GPS, LBS, and navigation apps are on the verge of exploding?Today Garmin announced its intent to make a public offer for all the outstanding shares of Tele Atlas, which was in the process of being acquired by TomTom. TomTom bid $2.8 billion for the mapmaker back in July. Garmin's offer stands at $3.3 billion, at $35.35 per share. The move is an interesting one.
Nokia recently put a bid for Navteq on the table, with plans to integrate mapping applications further into its device portfolio. TomTom makes navigation devices and could use Tele Atlas's mapping content. Garmin also makes mapping devices, and is somewhat larger than rival TomTom.
"Given the high growth and rapid change the navigation market has undergone to date, we feel that now is the right time for Garmin to move ahead with this proposed combination with Tele Atlas," Chief Executive Min Kao said in a statement. He also mentioned that Garmin would allow the company to operate independently and make its content available to any company interested in licensing it. By stealing Tele Atlas from TomTom, it stands to make money licensing the content rather than having to fork over cash to TomTom for it.
TomTom hasn't responded publicly, but you know its board members are probably a bit hot under the collar right now. Whether or not it will come up with a competing bid is unknown, but it'll have to be a whopper to best Garmin's.
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