U.S. navigational device maker Garmin said on Friday it dropped its pursuit of digital mapmaker Tele Atlas, clearing the way for rival Dutch bidder TomTom to seal the deal.
Tele Atlas shares tumbled 9 percent on the news, but Garmin stock jumped 14 percent as its withdrawal eased Wall Street concerns of a costly bidding war with TomTom.
Shares of TomTom also rose, gaining 8 percent as Tele Atlas was now expected to accept its $4.2 billion offer, which had trumped Garmin's $3.35 billion bid.
TomTom, Europe's biggest navigational device maker
click me, had sought Tele Atlas to gain control of
one of just two global digital mapmakers, and to reduce its dependence on selling hardware.
"Software revenue will in coming years become the largest growing sales stream ... TomTom is now well-equipped," said Keijser Capital analyst Nico van Geest.
Garmin and TomTom are the two top makers of
personal navigation devices, which use signals from government satellites
19-11-2007
Garmin pulls out of Teleatlas bidding race, leaving TomTom to seal the Deal
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