Swiss firm u-blox, the provider of wireless and positioning modules and chips, has done a deal with Shanghai-based SIMCom Wireless to acquire the company’s cellular modem products, patents and know-how, R&D and sales staff, and customer base.
The deal will significantly expands u-blox’s existing cellular product range and make it a major supplier of cellular modules worldwide, the company said. U-blox stated that acquisition will establish it as a leader for a range of 2G, 3G and 4G products, as well as creating new economies of scale.
The acquisition of SIMCom’s product portfolio also offers u-blox the ability to provide additional solution options and price points, which will widen u-blox’s customer base and increase its geographical reach.
The deal will significantly increase the company’s cellular module business in Asia, primarily China, and generate increased revenue in Europe and America. The larger scale will also provide the eventual opportunity to incorporate the recently announced u-blox’s cellular chips into select modules in the combined portfolio.
Listed on the Hong Kong stock exchange, SimTech Group Company will sell the assets included in the deal to u-blox for US$ 52.5 million in cash. The Swiss company’s biggest acquisition to date should increase revenues by approx. US$ 75 million for the remaining three quarters of 2017, taking total revenues to the half-billion US$ mark.
Following fulfilment of closing conditions and regulatory approvals, the acquisition should be completed within three months. The assets will be integrated into u-blox’s cellular product centre and help to expand the company’s R&D capacity by 150 specialists, and enlarge the sales organisation.
All SIMCom’s existing products will remain available under the SIMCom’s brand name.