Module maker Sierra Wireless is buying M2M service provider Numerex as part of the continuing consolidation of the space.
The $107m acquisition expands Sierra Wireless’ position as a leading global IoT pure-play supplier and, critically, will significantly increase its subscription-based recurring services revenue. Numerex is a supplier to companies such as Telefonica IoT and has a multi-year asset tracking deal with the US FEMA disaster relief agency, evolving out of the M2M cellular industry over the last 25 years.
“The acquisition of Numerex accelerates our IoT device-to-cloud strategy by adding an established customer base, significant sales capacity, proven solutions and recurring revenue scale,” said Jason Cohenour, President and CEO of Sierra Wireless. “The combination of Sierra Wireless and Numerex will represent a powerful business and technology platform that will enable the company to drive a global leadership position in IoT services and solutions.”
Although pitched as a merger, Numerex shareholders will own around 10% of Sierra.
“We believe that combining with Sierra Wireless will strengthen Numerex’s business, advance our product offerings, and accelerate the growth of our recurring revenue streams,” said Ken Gayron, Interim CEO and CFO of Numerex. “The transaction also provides our shareholders the opportunity to participate in the considerable upside potential of the combined company.”
The acquisition accelerates Sierra Wireless’ IoT device-to-cloud strategy and bolsters its position in the global IoT market with more sales capacity and an experienced team and channel. Numerex provides its technology and services through its integrated platforms, which are generally sold on a subscription basis to as managed end-to-end IoT solutions including smart devices, network connectivity and service applications in a wide range of vertical markets and industrial customers.