Platform Science to acquire Trimble’s telematics units to expand global transportation tech

Platform Science and Trimble (NASDAQ: TRMB) announced on 15 September 2024 a definitive agreement under which Platform Science will acquire Trimble’s global transportation telematics business units. The strategic acquisition aims to transform the transportation industry by merging two advanced in-cab commercial vehicle ecosystems to enhance driver experience, fleet safety, efficiency, and compliance.

Trimble to Become a Shareholder in Platform Science’s Expanded Business

As part of the acquisition, Trimble will acquire a 32.5% stake in Platform Science’s expanded global business and gain a seat on its board of directors. This move aligns Trimble with other key strategic investors such as C.R. England, Cummins, Daimler Truck, PACCAR, Prologis, RyderVentures, and Schneider, alongside financial investors 8VC, Activant Capital, BDT & MSD Partners, Softbank, and NewRoad Capital Partners.

Enhanced Telematics Solutions and Synergies

The proposed transaction will enable Trimble’s global transportation telematics customers to continue using their current solutions while gaining access to Platform Science’s Virtual Vehicle platform. This platform will offer new applications and solutions through the Virtual Vehicle Marketplace, designed to improve drivers’ quality of life and fleet performance. Existing Platform Science customers will also gain access to Trimble’s remaining portfolio of transportation solutions, broadening their choices.

Rob Painter, President and CEO of Trimble, emphasized the benefits of combining Trimble’s global transportation telematics portfolio with Platform Science. He stated, “We believe combining our global transportation telematics portfolio with Platform Science’s will further advance fleet mobility and provide our customers with a broader portfolio of solutions to solve industry problems.”

Jack Kennedy, Co-founder and CEO of Platform Science, highlighted the transformative potential of the partnership: “This partnership marks the inflection point for a true platform approach to transportation technology. Now, powered by OEM-native software services, we will deliver unprecedented choice.”

Transaction Details and Financial Implications

Trimble’s global telematics business units, part of its Transportation & Logistics segment, generated approximately $300 million in revenue and $30 million in operating profit over the trailing twelve months. The transaction is expected to boost Trimble’s organic revenue growth rate, gross margin, and operating profit margin.

The acquisition excludes other core Trimble transportation business units, including Enterprise, Maps, Vusion, and Transporeon, which will remain under Trimble’s Transportation & Logistics segment. Following the transaction’s completion, these units will continue to focus on priority growth areas.

Stock Performance and Sentiment Analysis

Trimble Inc. (NASDAQ: TRMB) is currently rated a “Moderate Buy” by six brokerages covering the stock. Out of these, five have issued a “Buy” rating, while one has a “Hold” rating. The average 12-month target price for Trimble shares is $65.33, suggesting a potential upside from the current share price of around $56.50. Recently, Trimble’s stock has shown some volatility, with a twelve-month range between $39.57 and $65.55. Despite facing challenges, including a recent Nasdaq deficiency notification due to a delayed quarterly report filing, Trimble’s fundamentals remain robust. Analysts predict an EPS of 2.22 for the current fiscal year, highlighting strong financial positioning.

Expected Closing and Regulatory Approvals

The proposed transaction is expected to close in the first half of 2025, subject to regulatory approvals and customary closing conditions. Trimble’s ownership in Platform Science will be accounted for under the cost method of accounting.

This strategic acquisition positions Platform Science and Trimble to accelerate innovation in transportation technology. By merging their capabilities and expanding the reach of the Virtual Vehicle platform, the partnership aims to offer more comprehensive and integrated solutions to meet the evolving needs of the global transportation industry.