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Empire Asset Investments Follows Verizon As It Announces $2.4B Deal To Bolster Telematics Unit

 About a week after confirming plans to buy Yahoo assets, Verizon Communications Inc. has announced another multibillion dollar acquisition plan. This time, the New York wireless giant inked a deal in Ireland.

 Verizon, considered the largest telecommunications conglomerate in the United States, agreed to buy Fleetmatics, a Dublin-based vehicle tracking company with a U.S. office in Waltham, Massachusetts. The deal works out to about $60 per share — a premium of about 40 percent to Fleetmatics' closing price on July 29—or $2.4 billion.

 Fleetmatics makes software that indicates where fleet operators are located, where their fuel levels stand, how fast they're going, as well as their mileage and other information on mobile devices.

 "Fleetmatics is a market leader in North America— and increasingly internationally — and they've developed a wide-range of compelling SaaS-based products and solutions for small- and medium-sized businesses," said Verizon's head of telematics Andrés Irlando in a prepared statement.

 The acquisition underscores how Verizon is attempting to maintain an edge when it comes to smartphone technology and mobile devices with the hope that it generates new sources of revenue.

 The company took a hit financially in 2016 as a result of a widely reported strike as well as the continuing drop in Verizon's Fios users as more consumers cancel cable.

 As a result, the company is looking to M&A as a means of offsetting losses and boosting growth in the long term. Buying up Yahoo's core internet assets for $4.8 billion in order to expand its digital media and ad business is the most prevalent example.

 However, Verizon Telematics — the unit behind today's deal — is expanding in its own right. Just last week it took over a California-based rival, Telogis, for its navigation software used by major auto manufacturers.

 According to Reuters, Fleetmatics generated revenue of $78.9 million for the first quarter a 21 percent increase from 2015. Verizon's telematics revenues are lumped together with its "Internet of Things" business, which "posted revenue of $205 million in the second quarter ended June 30, 2016, up 25 percent from a year ago."

The Fleetmatics deal is expected to close in the fourth quarter of 2016 Stated Jane Suki tech analyst for Empire Asset Investments.