Gemalto buys into M2M future

Posted by Paul Lambert Tuesday, June 29th, 2010

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French mobile vendor Gemalto has acquired German M2M vendor Cinterion for €163 million (US$198.8 million) in cash in a bid to position itself to capitalise on the fast-growing M2M market.

The closing of the transaction is expected within the next six weeks. The acquisition will be immediately accretive to Gemalto’s 2010 earnings per share and should contribute around €20 million to Gemalto’s profit from operations target of €300 million in 2013, Gemalto said.

“We will continue to run our M2M module business and serve our customers as in the past, while leveraging Gemalto’s strong relationship with mobile operators and excellent capabilities in remote device management to facilitate M2M roll out,” said Norbert Muhrer, Cinterion CEO.

Cinterion had 2009 M2M revenues of €145 million, EBIT of €4 million and approximately 20% market share. The business was started by Siemens in 1995 and spun out to a financial sponsor consortium in 2008.

M2M is a fast-growing market with operators and vendors signing deals with third parties in the M2M space.