(Bloomberg) -- Verizon Communications Inc. has agreed to buy GPS vehicle-tracking company Fleetmatics Group Plc in an all-cash deal valued at $2.4 billion, vaulting the telephone giant deeper into the automotive-technology market.
Verizon will pay $60 a share for the Dublin, Ireland-based company, a 40% premium to Fleetmatics’ closing price last week, according to a statement Monday. The deal is expected to close in the fourth quarter.
With its wireless business slowing, Verizon has been pursuing new sources of growth, such as connected-device subscriptions, video streaming, advertising and mobile-workforce management. In June, Verizon Telematics acquired Telogis Inc., a cloud-based mobile enterprise management software company based in Aliso Viejo, California. That transaction closed last week.
Verizon ended June with net debt of $96.9 billion, or 2.2 times adjusted earnings before interest, tax, depreciation and amortization. After announcing its deal to
Shares of Verizon gained 0.2% to $55.52 at 9:42 a.m. in New York and had climbed 20% this year through Friday. Fleetmatics soared 39% to $59.75.
PJT Partners and Wells Fargo Securities LLC are Verizon’s financial advisers on the deal and Cleary Gottlieb Steen & Hamilton LLP, A&L Goodbody and Macfarlanes LLP are providing legal counsel. Morgan Stanley is serving as financial adviser to Fleetmatics, with Goodwin Procter LLP and Maples and Calder giving legal counsel.