Updated from 7:38 a.m. EDT
Navigation devices maker Garmin (GRMN - Get Report) stunned investors Wednesday with an unsolicited 2.3 billion euro ($3.3 billion) bid for Dutch mapping company Tele Atlas, trumping a three-month old offer from rival TomTom.
News of the hostile bid and the prospects of a bidding war sent shares of Garmin sliding $9.73, or 8%, to $110.75 in recent trading and overshadowed the company's strong third-quarter results.
Garmin said it will offer $35.31 for a share of Tele Atlas, 15% higher than the $30.63 TomTom offered in July and a 48% premium to Tele Atlas' share price before TomTom's bid.Garmin said it expects a counter-bid from its Netherlands-based rival TomTom. Reik Read, an analyst with Robert W. Baird, took a dim view of the bid because of the possibility of a "bidding war as TomTom and Garmin have similar purchasing capability. "And assuming Garmin wins, this is a difficult integration of a software mapping company, which is dissimilar to a hardware company