I.D. Systems to Acquire Pointer Telocation for $140 Million
14 March, 2019
I.D. Systems and Pointer will each become wholly-owned subsidiaries of the newly-created PowerFleet, Inc., which is expected to be dual listed on Nasdaq and Tel Aviv
It is not clear whether this is a merger or an acquisition, but the bottom line is clear: The provider of wireless M2M solutions for managing assets and vehicles, I.D. Systems from New Jersey, is paying $140 million for the Israeli based Pointer Telocation. Pointer provides Wireless solutions and cloud-based software platform for Mobile Resource Management (MRM). Its annual 2018 sales reached $77.8 million, compared to $53 million of I.D. Systems.
The acquisition will be effected through a holding company structure: I.D. Systems and Pointer will each become wholly-owned subsidiaries of the newly-created PowerFleet, Inc., which is expected to be dual listed on Nasdaq and the Tel Aviv Stock Exchange. The transactions will be funded through a combination of a $50 million convertible preferred equity investment by Abry Partners and a $30 million debt financing by Bank Hapoalim (Israel).
The Acquisition expected to close in the Summer of 2019. Following the approval, I.D. Systems CEO, Chris Wolfe, and CFO, Ned Mavrommatis, are to lead the combined company with Pointer CEO, David Mahlab, to serve as CEO International. Pointer CFO, Yaniv Dorani will serve as Deputy to CEO International. “The acquisition combines our product leadership in North America with Pointer’s technology and broad international footprint,” said Wolfe.
Mahlab (photo above) said the deal is about to increase Pointer’s penetration in North America, “as well as expand our share of the global multi-billion-dollar IoT telematics market.” Today Pointer Telocation is engaged in a technological collaboration with Microsoft Israel, building an AI system for modeling and understanding driver behavior. The system will learn based on the large volume of driver behavior data collected by Pointer historically as well as on an ongoing basis. The analysis will be performed using Microsoft Azure cloud.
Pointer’s goal is to build a predictive system for driver behavior. The system will be able to forecast those drivers which are more likely to be involved in a future road accident in light of the way they drive and their history. It will also be able to indicate which component of their driving needs improving, in order to reduce their risks