French semiconductor and SIM card group Gemalto has agreed to acquire German machine-to-machine (M2M) wireless communications module company Cinterion Wireless Modules for EUR 163 million in cash. Cinterion generated EUR 4 million of EBIT on EUR 145 million of revenues from M2M in 2009, and claims an approximately 20 percent world market share. Its overall turnover is around the same as the purchase price, EUR 163 million. The company uses a fables business model and employs 335 workers with major centres in Munich and Berlin. It was founded by Siemens in 1995 before being spun out to a financial investment consortium in 2008. Applications for M2M modules include remote utility meter monitoring, at-home patient monitoring, tracking stolen vehicles and other high-value items, optimised fleet management, smart energy grids, pollution reduction and more. Gemalto hopes that by combining Cinterion's specialisation with its own know-how in deploying software and services for mobile operators, it will be able to deliver easy-to-deploy M2M systems to be used by industrial companies, administrations and the operators themselves. The transaction is expected to close in the middle of August. Gemalto said it would be immediately accretive to EPS and should contribute some EUR 20 million to its EUR 300 million 2013 operating profit target.
