Sat, Sep. 5, 12:02 PM
- News in the automobile industry this week continues to indicate seismic changes are coming.
- The Silicon Valley factor: A deeper commitment by Apple and Google in the automobile sector is widely anticipated, although an all-in bet on the manufacturing side is still considered a reach. Key acquisitions, partnerships, or joint ventures in software, self-driving technology, and infotainment systems could sort out the winners from the losers. German players BMW (OTCPK:BAMXY) and Mercedes-Benz (OTCPK:DDAIF) could be in the mix.
- The Sergio factor: Though the Fiat Chrysler Automobiles (NYSE:FCAU) CEO continues to make some bold projections on the powerful merger synergies a tie-up with General Motors (NYSE:GM) would create, his math works for other combinations within the industry as well. Nissan (OTCPK:NSANY), Tata Motors (NYSE:TTM), Honda (NYSE:HMC), and Volvo (OTCPK:GELYF) are each struggling in various markets.
- The Tesla factor: Tesla Motors (NASDAQ:TSLA) has engaged in a war of words with Toyota (NYSE:TM) in the electric vs. hydrogen debate. The EV automaker is also in a race with General Motors and Nissan over developing a mass-market EV with the driving range and sticker price to sell at scale. There's also been a tug-of-war over employees with Silicon Valley counterpart Apple. With so many enemies, some analysts think Tesla needs more friends in the space. Who has the ~$40B-$50B to buy out Elon or the moxie to strike a strategic partnership?
- Looking for a wildcard? Sony (NYSE:SNE) CEO Kazuo Hirai told the Financial Times this week that his company would absolutely partner with an automobile company if a deal makes sense.
Mon, Aug. 3, 1:57 AM
- A consortium of German carmakers, including BMW (OTCPK:BAMXY), Daimler (OTCPK:DDAIY) and Audi (OTCPK:AUDVF), have agreed to buy Nokia's (NYSE:NOK) maps business HERE for an enterprise value of €2.8B ($3.07B), as they look to extend their reach into digital services for connected cars.
- The sale will also help Nokia focus on integrating its €15.6B purchase of Alcatel-Lucent, a deal that will create the world's second largest network equipment maker.
- Previously: Bloomberg: Nokia close to HERE maps unit sale (Jul. 21 2015)
Tue, Jul. 21, 11:32 AM
- The WSJ and Germany's Manager Magazin report Nokia (NOK -0.7%) has reached a deal with a consortium featuring Daimler (OTCPK:DDAIY), BMW (OTCPK:BAMXY), and Audi (OTCPK:AUDVF) to sell its HERE mapping/navigation software unit for about €2.5B ($2.72B).
- The deal will reportedly be finalized by month's end, with the automakers subsequently running HERE, the top player in the automotive navigation software space, as an open platform. The reported sale price is less than the ~$4B Nokia was believed to be seeking.
- With HERE having 2014 revenue of €969M (+6% Y/Y), Nokia appears to be selling the unit for roughly 2.6x trailing sales. Bloomberg reported overnight Nokia and the automakers were close to a deal.
- Update: More details from the WSJ. Sources state the automakers "intend to purchase all of Nokia Here and then invite other global auto makers to take stakes in the company."
- Update 2: Reuters reports a deal worth between €2.5B-€3B is close, while adding the issue of patent ownership still needs to be worked out. The automakers want full ownership of Nokia's mapping patents; Nokia wants to keep control of some of the patents related to "how mobile devices connect to networks."
Tue, Jul. 21, 6:19 AM
- Nokia (NYSE:NOK) is nearing an agreement to sell its maps business HERE to a group of German luxury-car makers, including BMW (OTCPK:BAMXY), Daimler (OTCPK:DDAIY) and Audi (OTCPK:AUDVF).
- An agreement could be reached as early as next week, with an announcement targeted for around July 31, Bloomberg reports.
- Sources say Nokia has sought as much as $4B for the unit.
- NOK +1.3% premarket
- Previously: The latest on the Nokia HERE unit sale (Jul. 09 2015)
Thu, May 21, 1:38 PM
- Reuters reports Mercedes (OTCPK:DDAIF), BMW (OTCPK:BAMXY), and Audi (OTCPK:AUDVF) are partnering with P-E firm General Atlantic to bid for Nokia's (NOK +3.2%) HERE mapping/navigation software unit. Like Bloomberg on Monday, Reuters states HERE could fetch up to $4B.
- One source states General Atlantic would likely take a 30% stake; another states the automakers are each willing to contribute up to $780M towards a bid.
- The automakers, also mentioned in past M&A reports about HERE, have reportedly "made an indicative offer for an undisclosed amount." However, they're waiting for Nokia to respond before deciding whether to up their bid.
- Both Reuters and Bloomberg have reported Baidu, Uber, and P-E firm Apax Partners have launched a separate bid, and that a consortium consisting of Tencent, NavInfo, and Swedish P-E firm EQT Partners has also shown interest.
- Nokia has rallied to its highest levels since late April, when shares plunged in response to the company's Q1 results. All-stock merger partner Alcatel-Lucent (ALU +2.8%) is also higher.
Tue, Jan. 6, 8:20 AM
- The spinoff of Ferrari could give Fiat Chrysler Automobiles (NYSE:FCAU) enough breathing room to seek a merger partner, according to auto industry analysts.
- The rising cost of developing clean cars in Europe and the U.S. sets the stage for automakers to join forces through mergers and extended partnerships.
- "Eventually it must happen," notes FCA chief Sergio Marchionne on the topic of mega-mergers.
- No company is too big to be ruled out of the merger discussions due to the benefits of scaling investment costs and matching strengths/weaknesses in Europe, Latin America, China, and the U.S, note insiders.
- Automakers: GM, F, TM, FCAU, HMC, OTCPK:NSANY, TSLA, OTCQX:VLKAY, OTCPK:DDAIF, OTC:HYMLF, OTCPK:BAMXY, OTCPK:FUJHY, OTCPK:MMTOF, OTCPK:PEUGF, OTC:RNSDF, TTM, KNDI. OTCPK:SZKMY, OTCPK:MZDAY.
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