- Family app developer Life360 (360) is planning to acquire Jiobit, a provider of wearable location devices, for up to $70 million
- The acquisition would allow 360 to extend its audience reach and tap into the multi-billion-dollar elder care and pet supplies and services markets
- The upfront consideration would be US$37 million (roughly A$47.5 million) with potential to increase to US$54.5 million (approximately A$70 million) if certain performance targets are achieved
- 360 said this proposal is part of its strategic review, which is continuing to evaluate the company’s strategic and financial opportunities
- Shareholders seem to have responded well to the proposal, with shares trading 13.4 per cent higher at $5.93
Family app developer Life360 (360) is planning to acquire Jiobit, provider of wearable location devices, for up to $70 million.
The proposal marks the first stage of the company’s strategic review to acquire “strategically important” businesses.
Marketed for younger children, pets and seniors, Jiobit is a location-aware safety solution touted to be accurate, secure, reliable and real-time.
It combines a discreet wearable called the Jiobit Location Monitor, with mobile-based software services combined with patented location technology.
Through the acquisition, 360 hopes to grow its audience and tap into two fast growing markets — the multi-billion-dollar pet supplies and services and elder care markets.
The non-binding term sheet outlines the upfront consideration as US$37 million (roughly A$47.5 million), made up of Life360 shares, convertible promissory notes, and retention consideration, which is subject to adjustments at closing for working capital and certain tax modifications.
There is a possibility that the total consideration would increase to US$54.5 million (approximately A$70 million) if certain performance targets are achieved in the two full calendar years following completion. Additional performance-based consideration would be solely in the form of Life360 shares.
The total consideration may result in the issuance of up to approximately 2.42 million Life360 shares, which will be issued using the company’s existing placement capacity.
If the deal goes ahead, 360 plans to bundle Jiobit’s physical device into its top membership tiers, which the company believes could significantly boost both customer conversion and retention.
In July last year, 360 launched a new membership plan, giving app users access to a suite of bundled products focused on the safety and security of the family.
In particular, it included a family safety feature, providing medical and roadside assistance and even some pandemic and disaster response mechanisms.
The proposed acquisition is subject to due diligence and the completion of definitive documentation. The final transaction will also be subject to the approval of both companies’ boards of directors, as well as the stockholders of Jio.
360 strategic review plans to continue to evaluate both strategic and financial opportunities that will accelerate progress towards its vision of being the dominant platform for a much broader suite of family services.
Shareholders seem to have responded well to the proposal, with shares trading 13.4 per cent higher at $5.93 at 1:12pm AEST.