UPDATE: Navigation Co Mio Demands Guarantees From Tele Atlas
Jul 26, 2007 11:29:33 (ET)
(This updates a story published at 1331 GMT to add comment from TomTom.)
By Mathijs Schiffers, Of DOW JONES NEWSWIRES
AMSTERDAM (Dow Jones)--Mio Technology is considering switching road map suppliers if it doesn't get clear guarantees from its map supplier Tele Atlas NV (23394.AE) and from TomTom NV (38705.AE) to safeguard confidentiality after these two companies have merged, Mio's President Paul Notteboom told Dow Jones Newswires Thursday.
Mio Technology, as part of Mitac Inc. (8122.OT), makes navigation devices used in cars. Mio buys all the maps used in its navigation equipment from Tele Atlas, which is about to be bought by TomTom, one of Mio's strongest competitors.
Notteboom said he will talk to the management of Tele Atlas "and hopefully TomTom," sometime "in the coming weeks."
If Mio can't get clear guarantees, the company will consider switching to the only other global digital map supplier for navigation devices, Navteq Corp. (NVT), Notteboom said.
"If we develop a new product, then we do that in close cooperation (with Tele Atlas) and we can't accept that our main competitor knows about this," Notteboom said, adding that this is Mio's "key concern" regarding TomTom's plan to buy Tele Atlas as announced Monday.
TomTom's spokesman, Taco Titulaer, said Tele Atlas will be put "at arm's length" after the acquisition, and will operate as a seperate company. He said so far only the intention of a bid has been announced, and therefore it isn't up to TomTom to talk to customers of Tele Atlas at this stage.
Tele Atlas wasn't immediately available for comment.
Mio Technology is the third largest provider measured by units shipped in the booming market for personal navigation devices, after TomTom and Cayman Islands-based Garmin Ltd. (GRMN). Its market share in Europe, the Middle East and Africa in the first quarter of the year was 17.7%, including the recently acquired brand of Navman, based on estimates by research company Canalys.
Analysts and market watchers applauded TomTom's plan to buy Tele Atlas for EUR2 billion, including cash, but they said the potential loss of clients by Tele Atlas is one of the main risks of the deal.
TomTom itself represented 30% of Tele Atlas' sales in the first quarter of the year.
-By Mathijs Schiffers; Dow Jones Newswires +31-20-5890270; mathijs.schiffers@dowjones.com
(END) Dow Jones Newswires
July 26, 2007 11:29 ET (15:29 GMT) |
