M&A Alert - September 14, 2009
Nokia’s NAVTEQ Agrees to Acquire Acuity Mobile
Transaction Overview
On September 14, 2009, Navteq (NYSE: NVT) announced that it has agreed to purchase Acuity Mobile. The transaction value was not disclosed.
Target Description
Founded in 2000, Acuity Mobile, Inc. is based in Greenbelt, Maryland. Acuity provides mobile advertising platform enabling the delivery of interactive content, such as advertisements, coupons, offers, traffic, weather, and news to mobile users based on their interests, time of day, and geographic location. The advertisements are offered in various multimedia formats (sound, image, video and more). Its service supports campaign management, tracking and reporting as well as APIs for integration of marketing databases providing content, promotions and advertising to any application on any platform. Prior to the acquisition, NAVTEQ licensed Acuity’s mobile location-based advertising delivery platform.
Buyer Description
NAVTEQ, a subsidiary of Nokia Corp., provides digital map, traffic and location data for in-vehicle, portable, wireless and enterprise service providers. It offers driver assistance systems, NAVTEQ Discover Cities (which combines pedestrian thoroughfares with time-sensitive public transit system information to enable multi-modal routing), NAVTEQ digital map database (which provides a point of interest database), and NAVTEQ TRAFFIC (which provides real-time traffic services). Earlier this year, NAVTEQ launched NAVTEQ LocationPoint(TM) Advertising which enables advertisers to reach and engage consumers where and when they are making shopping and purchasing decisions. Chris Rothey, VP Advertising of NAVTEQ, was the executive sponsor of the transaction.
Transaction Parameters
The transaction value was not disclosed. Acuity Mobile had raised a reported $3.8mm in funding including $1mm in 2007 from undisclosed investors and $2.8mm of equity stake investment in February 2008 from NAVTEQ. NAVTEQ made the investment in Acuity Mobile before its acquisition by Nokia closed in July 2008.
Strategic Rationale
NAVTEQ is one of only two major map database providers globally. The integration of location-aware marketing capabilities into the NAVTEQ product offerings is a logical extension of NAVTEQ’s value proposition to its customers. Acuity Mobile was a natural choice for NAVTEQ given its existing license relationship and investment.
Architect Partners’ Observations
Acuity Mobile is a natural acquisition for NAVTEQ. This is another example demonstrating that M&A transactions frequently occur between companies that already have a strong relationship. This transaction also demonstrates the independent nature in which NAVTEQ is operating under Nokia ownership. Nokia has its own mobile marketing platform via several acquisitions, most notably Enpocket over the past several years. We suspect that, given the factset, this was a relatively low valuation transaction.