Gemalto has announced the acquisition of Cinterion Wireless Modules GmbH (CWM).
Cinterion is the leading provider of industrial Machine-to-Machine (M2M) wireless communication modules, with 2009 M2M revenues of €145 million, EBIT of €4 million and approximately 20% market share.
Cinterion, which uses a fabless business model, employs 335 staff with major centers in Munich and Berlin, Germany. The business was started by Siemens in 1995 and spun out to a financial sponsor consortium in 2008.
Combining Cinterion’s M2M module technology with Gemalto expertise in deploying software and services for mobile network operators will provide simple to deploy M2M solutions with proven security and demonstrated remote “overthe-air” management of devices for industrial companies, for administrations and for mobile network operators which are increasingly seeking to offer M2M communication services.
Gemalto will pay €163 million in cash for the CWM business, approximately one time annual sales. 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.
Cinterion’s business results will be reported as part of a new segment that will regroup Gemalto’s activity in this domain, called M2M, to reflect its value and strong growth potential.