Woodcliff Lake-based I.D. Systems Inc., a provider of enterprise asset management and industrial IoT technology, announced it will acquire all the outstanding shares of Pointer Telocation Ltd. for $140 million.
“We believe this is a transformative acquisition for I.D. Systems and our industry, as it combines our market and product leadership in North America with Pointer’s technology leadership, supply chain acumen and broad international footprint,” said I.D. Systems CEO Chris Wolfe.
Under terms of the deal, the $140 million will be comprised of $72 million in cash and approximately 11 million shares of PowerFleet Inc., a newly-created holding company.
The acquisition will create a new holding company structure, where I.D. Systems and Pointer will each become a wholly-owned subsidiary of PowerFleet. In the deal, Pointer shareholders will receive $8.50 in cash and 1.272 shares of PowerFleet common stock for each share of Pointer they own. Each share of I.D. Systems will be exchanged for one share of PowerFleet common stock.
Once the deal has closed, John Hunt, managing partner, and Anders Bjork, principal, both of Abry Partners, will join the PowerFleet board of directors.
Also, I.D. Systems CEO Chris Wolfe and Ned Mavrommatis, chief financial officer, will lead the combined company along with Pointer CEO David Mahlab.
“The combination of I.D. Systems and Pointer will deliver high-value, technology leading, IoT products globally. By expanding our product offerings and services, we expect to extend our leadership position in the growing mobile IoT and connected vehicle market, increase our penetration in North America, as well as expand our share of the global multi-billion-dollar IoT telematics market. I am extremely proud of Pointer’s track record of improving shareholder value and this combination marks yet another step in delivering on our commitment to that goal,” Mahlab said.
The deal is expected to close in the summer.
“Together, our combined team of exceptional employees will serve thousands of customers globally across 80 countries. These unique characteristics provide us not only with tremendous scale but, as important, position us to accelerate organic growth potential as well. Our combination establishes a robust global IoT platform with expansive product offerings, which we expect will enable us to capture greater share of the global multibillion-dollar IoT telematics software and solutions market,” Wolfe said.
Canaccord Genuity will act as the financial adviser and Olshan Frome Wolosky LLP and Goldfarb Seligman & Co. will act as legal advisers to I.D. Systems. ROTH Capital Partners will act as financial advisor and ZAG-S&W LLP will act as U.S. and Israeli legal advisor to Pointer. Lowenstein Sandler LLP and Meitar Liquornik Geva Lesham Tal will act as legal advisors to Abry Partners.