Fleetmatics, the Dublin-headquartered technology business that Verizon is buying for $2.4 billion, has told its staff that it remains committed to its Irish operation, which employs close to 200 engineers and developers.
Fleetmatics employs 1,200 globally and sells cloud-based software to companies who want to monitor the performance of their car and truck fleets. The Nasdaq-listed company announced on Monday it is to be bought out by Verizon, although Fleetmatics has declined to make any further comment.
In a presentation to staff following the announcement, Jim Travers, Fleetmatics' chief executive, said Verizon had approached the Irish company about a deal. Talks between the two businesses began in May, Fleetmatics said.
Mr Travers told staff that it decided to join forces with Verizon to give Fleetmatics further clout as it expands globally. Most of its business is in the US and Canada, but it has also targeted continental Europe and Australia in recent years.
Mr Travers said its core market was still lightly penetrated, but Fleetmatics is “in a race” to conquer it. He said the Irish company would benefit from Verizon’s “distribution and brand recognition” when chasing sales.
He confirmed that Fleetmatics will be housed in Verizon's new product division, which is tasked with driving growth at the telco in the internet age. Verizon last month also bought Fleetmatics' main rival in the US, Telogis, for a price reputed to be around $1 billion.
Mr Travers spoke of the potential synergies between Telogis, Fleetmatics and Verizon Telematics, although it is unclear if the three will be formally merged.
Fleetmatics staff received no detail on whether there would be any site closures, and were told only that the integration plan would be revealed after the deal closes in the fourth quarter of 2016.
The company confirmed, however, that it intends to maintain its Irish operation which, under the leadership of company co-founder and current chief technology officer Peter Mitchell, conducts much of its product design and research.
The company also attempted to reassure staff that Verizon was buying it in part because of the skills of its workforce. Fleetmatics is far bigger than Verizon’s existing in-house telematics company.
Although both Verizon and Fleetmatics operate primarily in the US, the deal will be consummated under a scheme of arrangement overseen by the Irish High Court as Fleetmatics was founded and is headquartered here.
Verizon’s advisers include Dublin firm A&L Goodbody, while Fleetmatics’ local law firm on the deal is Maples and Calder. The Irish company’s financial adviser on the transaction is Morgan Stanley.
Irishman Colm Donlon, who heads up Morgan Stanley's European mergers and acquisitions practice, is also advising Fleetmatics. Mr Donlon is known in the British media as the "Harry Potter of M&A".
Mr Travers told staff the company had come a long way since it was founded in 2004 “above a pub” in suburban Dublin.
The company was originally founded in a merger between Websoft, backed by Oyster Capital's Bill McCabe, and Moviltec, backed by Ken Keating of Cross refigeration group. Websoft's office was beside the Morgue pub in Templeogue.
Mr McCabe, one of the State's best-known tech investors, continued to back Fleetmatics and Mr Travers was hired to drive growth in 2006. In 2008, it brought on board outside investment for the first time, selling 35 per cent to Investcorp Technology Partners for $25 million.
In 2010, Mr McCabe and most of its Irish backers, with the exception of management, sold out as part of a $68 million deal fronted by private equity groups, Institutional Venture Partners and New Word Ventures.
Fleetmatics floated on the Nasdaq in 2012, retaining its Irish domicile although most of its business is outside the State. Mr Mitchell is the most senior of the original founders to have remained with the business.
Many of the early directors and backers of Fleetmatics are now involved in another of Mr McCabe’s firms, FieldAware, which sells technology linking companies with their sales agents.
