Verizon Makes a Telematics Acquisition; IBM Reportedly Mulls a Retail Acquisition

Verizon buys cloud fleet-management software firm Fleetmatics for $2.4 billion

Fleetmatics and Yahoo! don't have a lot in common. But they each complement existing Verizon (VZ)  businesses, and give the company a chance to further diversify its revenue base at a time when it's seeing little to no telecom service revenue growth.

Verizon isn't getting Fleetmatics for cheap -- its acquisition price is equal to 28 times Fleetmatics' consensus 2017 EPS estimate, and 5.9 times its consensus 2017 sales estimate. The deal follows one in June to buy Telogis, a provider of telematics and routing software and services for vehicles.

Verizon appears to be betting the telematics market will continue seeing healthy growth as adoption of in-vehicle 4G connectivity keeps rising, and that it can integrate Fleetmatics and Telogis' telematics offerings with its own to stand out in a fragmented market.

Telematics hardware, software and service providers CalAmp (CAMP) and Novatel  (MIFI) rose sharply following news of the deal, as hopes surged that they would receive bids as well. Novatel bought South African telematics firm Digicore last year; CalAmp recently bought vehicle security and tracking firm LoJack.

IBM is reportedly in talks to buy point-of-sale software firm Revel Systems

Bloomberg reports IBM (IBM) is in early talks to acquire Revel Systems, provider of an iPad-based point-of-sale (POS) hardware and software system for merchants.

Revel competes with Square, PayPal (PYPL) , NCR (NCR) and others in the iPad POS market; its customers include Cinnabon, Chobani, and Popeyes. It has 750 employees, and was valued at more than $500 million in a $13.5 million 2015 funding round.

Much like healthcare, IBM views the retail vertical as a growth opportunity. Big Blue has been steadily building out its retail and commerce software offerings, as it does battle with the likes of Oracle  (ORCL) and NCR. The company bought retail analytics software firm DemandTec in 2011, and has launched iOS apps for retailers through its partnership with Apple (AAPL) .

Salesforce buys productivity/collaboration app developer Quip for a reported $750 million

As growth in its bread-and-butter sales force automation software business slows, Salesforce.com (CRM) is clearly looking to expand its horizons. The company discloses it paid $582 million to buy startup Quip, not counting the value of Salesforce's existing stake in the company. Sources tell TechCrunch the total acquisition price is $750 million.

Quip, founded by former Facebook (FB) CTO Bret Taylor in 2012, provides mobile, PC and cloud apps for editing, sharing and collaborating on documents and spreadsheets. That, of course, puts the company in competition with Microsoft's (MSFT) Office 365 and Google Apps. It claims over 30,000 companies as clients, including Facebook, CNN and Instacart, and prices its offerings fairly aggressively -- $30 per month for five workers, and $10 per month for each additional worker with an annual commitment. An enterprise offering goes for $25 per user per month.

The timing of the deal is interesting, given Microsoft, the productivity software market's 800-pound gorilla, just outbid Salesforce to buy LinkedIn (LNKD) . More deals outside of Salesforce's core cloud software market could be on the way.

As far as Quip goes, the large and steadily-growing number of apps and features supported by Office 365, along with the large ecosystem surrounding Office, presents a clear challenge for Salesforce.

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