FleetCor Technologies Operating Company, LLC – a subsidiary of FleetCor Technologies, Inc. (FLT - Free Report) – has entered into an agreement to buy the Telenav enterprise business unit from Telenav, Inc. (TNAV - Free Report) . The company will pay the purchase consideration of $10 million in cash.
FleetCor and Telenav expect the deal to close in 30 days, near the end of the fiscal third quarter of Telenav. As a result, the financial results of the quarter will be relatively unaffected by the deal. However, the company expects the revenues for fiscal 2013 to be affected by the sale. As a result, the company announced a revenue guidance of $190–$194 million for fiscal 2013.
Meanwhile, FleetCor did not reveal the expected impact of the acquisition on its financial results. Further, the two companies did not divulge other details of the agreement.
Telenav's enterprise business is designed to provide operational management support to clients. Its location-based services (LBS) platform helps clients track the status and position of mobile personnel, automobiles and assets operating in the fields.
Telenav will assist the smooth transition of the business to FleetCor by continuing to provide some services after the closure of the deal. Telenav decided to divest the enterprise business as it was not aligned with its other businesses. Consequently, the company’s focus was being deviated from the consumer, advertising and automotive businesses, which are fast growing areas.
FleetCor currently carries a Zacks Rank #2 (Buy), while Telenav carries a Zacks Rank #3 (Hold). Other companies worth considering in the financial sector are Euronet Worldwide Inc. (EEFT - Free Report) and Grupo Financiero Banorte, S.A.B. de C.V. . Both these companies carry a Zacks Rank #1 (Strong Buy).