M2M Satellite Outfit ORBCOMM to Buy Peer SkyWave

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ORBCOMM today unleashed a constellation of news. That includes plans to acquire fellow M2M satellite outfit SkyWave Mobile Communications, and a public offering of common stock that it hopes to use to fund that deal.

SkyWave, the largest M2M service provider on the Inmarsat global L-band satellite network, is being bought for $130 million in a deal that’s expected to close early next year. The pairing, ORBCOMM said, will help it scale its business, deliver customers a broader array of options, and create long-term shareholder value. It also brings valuable engineering talent and robust distribution channels in Asia, the Middle East, and South America to ORBCOMM, the company said.

The public offering of ORBCOMM stock, which is expected to close on Nov. 13, includes 12,857,143 shares for $5.60 each. This exercise is expected to generate up to $72 million, the proceeds of which ORBCOMM plans to use to fund the SkyWave acquisition.

ORBCOMM bills itself as an M2M solutions provider that delivers devices coupled with global satellite, cellular services, and web applications. The company this year has been launching OG2 satellites, which it says will drastically increase network capacity, will enable faster message delivery, larger message sizes, and better coverage at higher latitudes.

Marc Eisenberg, ORBCOMM CEO, in April commented, “Our customers are looking forward to our new constellation, which will enhance their M2M applications, as well as new partnerships in the multiple additional markets for which OG2 is well suited.”

Caterpillar Inc., Doosan Infracore America, Hitachi Construction Machinery, Hyundai Heavy Industries, I.D. Systems, Inc., Komatsu Ltd., Cartrack (Pty.) Ltd., and Volvo Construction Equipment, are among ORBCOMM’s customers.

SkyWave, meanwhile, has been around for 17 years and is particularly strong in the fleet management space. In a September interview with M2M Evolution, Sue Rutherford, vice president of marketing at SkyWave, said the company also manufactures smart terminals for cellular and satellite, and is noted for its end-to-end solutions, which include everything from devices to connectivity to support and service, and even to some applications in an effort to help customers get to market more quickly. 




Edited by Alisen Downey
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Executive Editor, TMC

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