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U-Blox acquires SIMCom Wireless for $52.5m

Steve Rogerson
January 26, 2017

Swiss wireless module company U-Blox is acquiring Shanghai-based SIMCom Wireless, an M2M wireless module supplier, in an asset deal worth US$52.5m.
U-Blox is acquiring the company’s cellular modem products, R&D team and customer base, which will expand its cellular product range and make it one of the world’s largest suppliers of cellular modules.
The deal significantly expands U-Blox’s existing cellular product range and makes it a major supplier of cellular modules worldwide. The acquisition establishes the company with a range of 2G, 3G and 4G products and creates new economies of scale.
The acquisition provides additional options and price points that will widen the company’s customer base and increase its geographical reach.
The deal also significantly increases the cellular module business in Asia, primarily China, and generates increased revenue in Europe and America.
The larger scale will also provide the eventual opportunity to incorporate the recently announced U-Blox cellular chips into select modules in the combined portfolio.
Listed on the Hong Kong stock exchange, SimTech Group will sell the assets included in the deal to U-Blox for $52.5m in cash. The Swiss company’s biggest acquisition to date should increase revenues by around $75m for the remaining three quarters of 2017, taking total revenues to the half-billion dollar mark.
Following fulfilment of closing conditions and regulatory approvals, the acquisition should be completed within three months. The assets will be integrated into U-Blox’s cellular product centre and help expand the company’s R&D capacity by 150 specialists, and enlarge the sales organisation.
All SIMCom’s existing products will remain available under the SIMCom’s brand name.
Subject to closure, U-Blox has adjusted its guidance figures for 2017. The company now expects revenues to reach between CHF485m and 515m, with profits in the region of CHF60m and 65m including integration costs.
U-Blox has launched the ZOE-M8G GNSS receiver module for markets where small size and weight and high location precision are essential. It can be concurrently connecting to GPS, Galileo and either Glonass or Beidou. It also provides -167dBm navigation sensitivity. This makes it suitable for wearable devices, unmanned aerial vehicles and asset tracker applications.