u-blox acquires SimTech Group to expand cellular product range

The company claims that the acquisition firmly establishes u-blox as a leader for a range of 2G, 3G and 4G products and creates new economies of scale. The acquisition of SIMCom’s product portfolio offers additional solution options and price points which will widen u-blox’s customer base and increase its geographical reach. The deal 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’s cellular chips into select modules in the combined portfolio.

Listed on the Hong Kong stock exchange, SimTech Group Company 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 approximately $75m for the remaining three quarters of 2017, taking total revenues to the half-billion dollar mark. Following fulfillment 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 to 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 adjusts its guidance figures for 2017. The company now expects revenues to reach between 485 and 515 million Swiss francs, with profits in the region of 60 and 65 million Swiss francs including integration costs. Details can be found in the table below: