TomTom sold its telematics business for $1B to focus on out-mapping Google
TomTom, the Dutch online mapping company known for its car-based GPS systems, sold its telematics (fleet management) division to tire-maker Bridgestone for a whopping $1.03B.
As the self-driving car era shifts into gear, TomTom wants to focus on in-car navigation systems to compete with its age-old nemesis: Google Maps.
A geographic grudge-match against Google
After releasing the world’s first mass-market ‘personal navigation device’ in 2004, TomTom took off, hitting $65/share in 2007. But when Google released its Maps app in 2007, it turned every smartphone into a ‘personal navigation device.’
In just 2 years, TomTom’s stock fell below $3 per share. But, TomTom steered clear of disaster by shifting focus from consumers to ‘strategic’ partners, inking geo-data deals with Volkswagen, Toyota, and Apple.
But the Google Reaper returned last year when Google signed Maps partnerships with Renault, Nissan, and Mitsubishi — and TomTom won’t get fooled twicetwice.
The dogfight for the dashboard
Unfortunately for TomTom, Google isn’t the only other dog in the fight: In 2015, Audi, BMW, and Daimler bought TomTom’s biggest location data rival, Here, from Nokia for $3.07B.
TomTom’s stock fell 6.2% after the Bridgestone announcement, and while TomTom plans to stay independent, now it seems like anything could happen.
After the sale, TomTom will pay out more than $800m to shareholders, keeping the nearly $200m remainder on hand to grow its core location technology business.