Sierra Wireless Acquisition Signals Shift in Data Cards

Sierra Wireless, the maker of wireless data cards, and Wavecom S.A., the maker of machine-to-machine communications chips, announced today that the companies have reached a Memorandum of Understanding providing for a business combination that will bring together these two industry innovators to form a global leader in wireless data. Vancouver-based Sierra Wireless is paying approximately US $280 Million to buy the Paris-based maker of machine-to-machine communications chips.

GigaOM's Stacey Higginbotham figures it’s a good move for Sierra, which is paying a 108-percent premium over Wavecom’s last trading price, in order to beat rival bidder Gemalto. For Sierra, the deal gives it the ability to follow the growth of the web as it moves beyond people to machines. The deal also provides a new avenue for growth as Sierra sees interest in wireless cards fade as communications chips are embedded directly into laptops.