Monday, January 27, 2014

Seeking Alpha: Without A Buyer, TomTom's Route Is Unclear

When the best exit strategy for a stock is a buyout from a company that may not actually need the products or technology involved, it's tough for me to get all that excited. Be that as it may, the potential of a buyout has been the strongest bull argument for TomTom (OTCPK:TMOAY) (TOM2.AS) for over a year, as many have argued that Apple (AAPL) needs to, or at least should, acquire TomTom to secure its position in mapping and location technology.

There's little argument that mapping/location/navigation technology is important for smartphone manufacturers, and increasingly for automobile manufacturers as well. Whether its important enough for another company to shell out the more than the $1.6 billion it would likely take to acquire TomTom is debatable. The rise of "social mapping" is creating more technology options and the sale of Nokia's (NOK) handset business to Microsoft makes Nokia a more viable licensing partner. I'm not going to rule out the possibility of a company buying TomTom for its map assets, but the stock appears about 20% overvalued on its own independent merits and that makes this more of a binary story than I prefer.

Read the full article here:
Without A Buyer, TomTom's Route Is Unclear

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