In a move expected to herald further intense competition among tyre companies moving deeper into telematics and fleet management, Bridgestone last month paid €910 million (£785 million) for the telematics division of TomTom.
The deal is expected to be finalised by the end of June.
News broke last September about the Dutch company’s intention to sell its telematics business as it focuses more and more on the location technology being employed increasingly in the latest generation of “connected” vehicles.
Speculation about potential bidders for TomTom Telematics has been rife over the past five months. Those thought to have been involved in recent negotiations include Daimler, Microsoft, Verizon Communications and Michelin.
The French tyre maker’s plan, it seems, was to incorporate TomTom Telematics into its fast-expanding Michelin Solutions division, already focused on fleet management. Bridgestone’s European division, a subsidiary of the Japan-based corporation which claims to be the world’s largest tyre manufacturer and arch-rival of Michelin, seems to have outbid all these.
“We have found our perfect match in TomTom Telematics,” says Bridgestone EMEA (Europe, Middle East and Africa) chief executive Paolo Ferrari.
“Our companies’ complementary assets and capabilities will create a fleet solutions powerhouse, and further strengthen Bridgestone’s digital technology arm. We are now well-positioned in EMEA to enhance our core tyre business, accelerate our data-driven business, expand our fleet customer base and seize fast-growing, profitable opportunities in the automotive mobility industry.
“We recognise and respect the talent and skills of the TomTom Telematics management team and its 670 employees. It’s our intention to foster and grow the business and support its current plans.”
Harold Goddijn is chief executive of TomTom NV, based in Amsterdam. “After a thorough review of strategic options, we have determined that the sale of Telematics to Bridgestone is in the best interest of both Telematics and our core location technology business,” he says.
“We will continue to invest in our innovative map-making system, enabling faster map updates while lowering operational costs, paving the road towards autonomous driving.”
TomTom is thought to have around 50,000 customers for its telematics equipment (mainly sat-navs) and services. Of the 860,000 vehicles estimated to be using TomTom Telematics equipment of one sort or another at present, as many as 66% are commercial vehicles.
“TomTom is the number one telematics service provider in Europe, and we continue to grow the installed base of vehicles we service globally,” says TomTom Telematics managing director Thomas Schmidt.
“We look forward to accelerating our ambitious growth plan and seize new opportunities as part of Bridgestone. In the meantime, we expect the transition to be seamless with no disruption for our customers, suppliers and employees.”
The Bridgestone deal is subject to approval by regulatory authorities, by TomTom shareholders, and by its employee representative bodies.