NomadIQ to be acquired by OmniSky in all-stock transaction - Buzzy Gordon
Jerusalem-based NomadIQ has agreed to be acquired by OmniSky Corporation of Silicon Valley, in an all-stock transaction worth $26.25 million, [$40 Million if all milestones are met] the companies said yesterday.
NomadIQ, which is located in the capital’s Malha Technology Park, has pioneered a unified communications platform for the delivery of location-based services that leverages both on-line and cached data on hand-held devices, whether cellular telephones or PDAs (personal digital assistants, including palm-size computers).
The idea for NomadIQ originated with Ari Gottesmann & Michael Kagan of Profile Technology Ventures, a Jerusalem partnership comprising Kagan and Ian Solomon. NomadIQ was formed in late 1999 by Kagan, Jacob Ner-David, and Ari Gottesman, and already employs more than 50 people.
“I also want to give credit to Israel Seed Partners,” Ner-David told The Jerusalem Post. “Jon Medved of Israel Seed was more than just our first investor. Israel Seed took a big risk, believed in us, and worked hard for us.”
Under the terms of the agreement, OmniSky will issue 2.5 million shares to the shareholders of NomadIQ, including a pool of options for employees, upon closing. The agreement also provides for the issuance of up to an additional one million shares over a 12-month period, if certain performance milestones and other conditions are met.
“We signed the agreement knowing that we would be meeting these milestones,” Ner-David told the Post. “Therefore, the deal really is for 3.5 million shares [worth in total over $40 Million at the time of signing].”
The share trading price of Nasdaq-listed OmniSky, which has a market valuation of $500m., closed at $7.5 on Wednesday. The deal is expected to close within the next few weeks, subject to the receipt of certain regulatory consents.
“The acquisition of NomadIQ strengthens OmniSky’s position as a leading innovator and award-winning provider of wireless Internet and e-mail services to users of hand- held devices,” OmniSky said in a statement. “The acquisition will accelerate plans to deliver next generation services to its subscribers - including location- sensitive mobile commerce and user-to-user communications.”
OmniSky developed an appreciation for NomadIQ’s technology over the course of talks that began between the companies in October, Ner- David said. “Just as important, OmniSky realized they were acquiring a top-notch team to implement the technology,” Ner-David asserted.
“NomadIQ has developed what we believe to be the most robust and comprehensive product for location-based applications and services,” added Patrick McVeigh, chairman and CEO of OmniSky.
“We expect NomadIQ’s platform to enhance our revenue opportunities, to further differentiate our service in the market, and importantly, to help us continue to grow a loyal and active community of subscribers.”
The OmniSky statement acknow-ledges that “with the acquisition of NomadIQ, OmniSky gains a highly experienced and accomplished team to work towards an aggressive road map of future services. NomadIQ’s executive team will continue on with OmniSky.”
Ner-David said it was likely that NomadIQ’s name would change to reflect becoming a division of OmniSky.
The NomadIQ service allows subscribers to access location-based information and interact with a community of users by leveraging both on-line and stored data. Once integrated with the OmniSky service, subscribers will be able to use hand-held devices for mobile commerce purposes: to locate and access comprehensive and media-rich information about local restaurants, entertainment venues, and other businesses as a function of their location; view and interact with maps and receive directions to those businesses; save this information on their hand-held device; and connect with merchants in person or on-line to complete a transaction, such as buying movie tickets or making restaurant reservations.
In addition, end users will be able to identify the location of - and invite other subscribers to - an event or a place and send along pertinent data, including the address and directions, which, in turn, can be saved on the hand-held device.
Moreover, users will be able to engage in real-time communications and collaboration, including instant messaging, with friends and colleagues.
OmniSky’s product and technology teams have begun integration efforts and anticipate rolling-out service by the end of the first half of 2001. Similar services will be offered in Europe through OmniSky’s international joint venture with News Corp.
