TomTom Reportedly Weighs Options, Including Sale
TomTom, the Dutch maker of navigation software and devices, is exploring options that could lead to a sale as mapping technology draws growing interest from potential buyers, according to people familiar with the matter.
TomTom, which operates an office in Lebanon’s Centerra Park, is attracting companies and investors who were looking at Nokia’s maps business, called HERE, which it agreed to sell to German carmakers on Monday, the people said, asking not to be identified because the discussions are private. While the $2.5 billion Dutch firm is speaking to possible advisers, there is no formal process underway and TomTom may decide against pursuing a sale and instead focus on investments, they said.
TomTom and Nokia are among few groups with digital-map assets, which are sought after by companies ranging from technology firms to social networks and e-commerce providers to car manufacturers. On May 19, Amsterdam-based TomTom said it extended a licensing agreement with Apple Inc. for maps and related information.
“We’re not talking to anybody about a sale,” Richard Piekaar, a spokesman for TomTom, said.
While TomTom shares are up more than 80 percent this year, the company is still valued well below its all-time high closing price of 53.56 euros, reached in November 2007. It currently has a market value of about 2.3 billion euros ($2.5 billion).
Nokia on Monday announced the sale of its digital-map unit for 2.8 billion euros to BMW, Audi and Daimler, which will gain technology for connected cars that will eventually be the basis for self-driving vehicles.
The carmakers held preliminary talks with TomTom as an alternative to buying Nokia’s maps business, people with knowledge of the matter said.
“It sets a price for the strategic value of maps, which is more than TomTom’s entire market value including their telematics business and their consumer division,” Marc Hesselink, an analyst for ABN Amro Bank, said by phone. “Now that this goes to three carmakers, that means TomTom has an opportunity to gain market share at the other carmakers.”
Before the German carmakers won the auction, Uber Technologies Inc. also considered teaming up with Baidu Inc. and Apax Partners to bid for Nokia’s maps business, people familiar with the matter said previously.
Microsoft has also considered buying a minority stake, they said.
Other companies that were interested in the business included a group comprising China’s Tencent Holdings, NavInfo and Swedish buyout firm EQT Partners, as well as three U.S. private-equity firms: Hellman & Friedman, Silver Lake Management and Thoma Bravo, the people said.