- Acquisition Significantly Expands Airgain’s Growth in its Enterprise Market with Cellular-based Edge Devices and Platform Software for Industrial IoT and M2M Applications
- Conference Call Scheduled for Today, January 7 at 5:00 p.m. ET
Airgain, Inc. (NASDAQ: AIRG),a leading provider of advanced antenna technologies used to enable high performance wireless networking across a broad range of devices and markets, including consumer, enterprise, and automotive, has acquired privately-held NimbeLink Corp., a leader in cellular industrial Internet of Things solutions and services. The addition of NimbeLink’s embedded modem products and asset tracking solutions is key to Airgain’s ongoing strategy to expand its penetration of the multi-billion-dollar Industrial IoT and M2M (machine-to-machine) markets.
NimbeLink Overview
Headquartered in Plymouth, MN, and founded in 2013, NimbeLink is a trusted partner for edge-based cellular connectivity Industrial IoT solutions. NimbeLink’s certified Skywire® cellular modems enable original equipment manufacturers (OEMs) to dramatically reduce their cellular development time. NimbeLink develops and markets complete edge-to-enterprise asset tracking solutions that are precisely configured to customers’ use cases and applications such as location tracking, inventory management, and resource optimization. Established in 2013, NimbeLink has sold more than 400,000 units over the last two years and its patented products have been deployed for thousands of end customers through multiple partner relationships. Based on preliminary, unaudited results, NimbeLink expects to report $12.5 million in revenue and $0.1 million in adjusted EBITDA for the fiscal year ended December 31, 2020 (see note below regarding “Use of Non-GAAP Financial Measures,” for further discussion of this non-GAAP measure).
Acquisition Expectations and Rationale
- Accelerates Airgain’s Enterprise Market Growth
- Extends AirgainConnect® Platform Breadth and Opportunity
- Extends NimbeLink Salesforce Reach Internationally
- Allows NimbeLink to Address Larger Design Win Opportunities
- Opportunities to Improve NimbeLink Product Performance through Airgain Antenna System Enhancements
- Increases Revenue Scale and Diversification
Through the combined product offering, Airgain plans to accelerate new wireless product and solution development to expand its market footprint while creating new and expansive revenue opportunities. NimbeLink’s expertise in cellular modem integration, carrier certification, and cloud management software is expected to enable the rapid realization of the company’s global vision for the AirgainConnect® antenna-modem platform. Airgain’s global presence will provide the means to extend NimbeLink’s salesforce reach internationally and is expected to bring larger design win opportunities. In addition, NimbeLink’s asset tracking and embedded cellular modem products are expected to leverage Airgain’s advanced antenna design and integration expertise to improve wireless performance.
“We are proud to welcome NimbeLink to the Airgain team and look forward to strengthening our enterprise offering with proven edge-based cellular connectivity solutions for Industrial IoT and M2M applications,” said Jacob Suen, Airgain’s President and Chief Executive Officer. “NimbeLink is an excellent fit with our business and will play an important role in our overall growth strategy to broaden market diversification and extend the development of the AirgainConnect antenna-modem platform. The sum of the parts is truly greater than the individual pieces and together, we believe the combined company significantly advances our strategic mission to deliver higher levels of integrated wireless system solutions globally.”
Scott Schwalbe, NimbeLink’s Co-Founder and Chief Executive Officer, commented: “We are very excited about what the combined strength of Airgain and NimbeLink will bring to our cellular connectivity and asset tracking customers. Airgain’s high performance antenna technology complements NimbeLink’s portfolio of cellular technology and will provide our customers with the benefit of enhanced product performance and a broader reach into global markets. Together, we will build upon our core competencies and advance forward-thinking Industrial IoT development and design at the network edge.”
Financial Details and Outlook
Under the terms of the transaction agreement, Airgain acquired all of the outstanding capital stock of NimbeLink for an upfront cash purchase price of approximately $15 million, subject to working capital and other customary adjustments, and NimbeLink’s former equityholders have the potential to earn up to an additional $8 million in cash based on achievement of certain revenue targets for fiscal year 2021. The transaction was financed by Airgain’s existing cash. The acquisition was signed and simultaneously closed on January 7, 2021. On a pro forma basis, taking into effect the NimbeLink acquisition, as of January 7, 2021, Airgain expects to have approximately $23.0 million of cash and cash equivalents and no debt.
NimbeLink management expects to report unaudited revenue of $12.5 million for the fiscal year ended December 31, 2020. The acquisition of NimbeLink is expected to be accretive to Airgain’s non-GAAP earnings per share immediately in Q1 2021 and is expected to enhance Airgain’s long-term revenue growth potential (see note below regarding “Use of Non-GAAP Financial Measures,” for further discussion of this non-GAAP measure).
These estimates are preliminary and unaudited, and are therefore subject to change.
Acquisition Conference Call Information
Management will discuss the acquisition on a conference call today (January 7, 2021) at 5:00 p.m. Eastern time (2:00 p.m. Pacific time).
Please follow the below link to register for the conference call. Upon registering, you will be provided call details with a unique ID.
Registration: http://www.directeventreg.com/registration/event/1359209
For participants who would like to join the conference call via telephone, please register by dialing 1-888-869-1189 or 1-706-643-5902.
The conference call will be broadcast simultaneously and available for replay here and via the investor relations section of the company’s website.
A replay of the call is available after 8:00 p.m. Eastern on the same day through February 6, 2021.
U.S. replay dial-in: 1-855-859-2056 or 1-404-537-3406
Conference ID: 1359209
If you have any difficulty connecting with the conference call, please contact Airgain’s IR team at 1-949-574-3860.