), a worldwide provider of satellite navigation, communications and
information devices announced the acquisition of Swedish company
Nexus Marine AB for an undisclosed sum.
Nexus specializes in designing, manufacturing and distribution
of navigation instruments for racing and cruising yachts. The
company has a diverse product portfolio, which comprises sailboat,
powerboat, sailing instrumentation systems and other related
peripherals for the sailing arena.
The acquisition makes perfect sense, as Nexus Marine's expertise
in the sailing space will complement Garmin's years of experience
in navigation systems for the marine segment. Garmin will largely
benefit from Nexus' skills for designing instruments that are used
in the marine industry.
According to global market research and management consulting
firm Lucintel, the global recreational boat market is expected to
grow at compounded annual growth rate (CAGR) of 8.5% and may reach
$30.63 billion in 2017.
Garmin is aggressively adding to its marine product portfolio.
In the last few quarters, Garmin launched GDL TM 40 cellular marine
weather receiver, the GHS TM 20 and 20i wireless remote handsets
for Garmin's VHF 200 and 300 series marine radios and an updated
version of the GHP TM 12 marine autopilot.
Garmin continues to invest heavily in the development of
products across all segments. Garmin's research expense in 2011
increased 25.0% year on year to $29.7 million.
Garmin is also looking for strategic acquisitions that could
complement and build on its current portfolio of products. It is
also increasingly marketing its products through OEMs, which will
gradually increase the stability of its revenue stream.
Garmin's second-quarter revenue of $718.2 million was up 29.0%
sequentially and 6.5% year over year, helped by particular strength
in the outdoor segment, which increased double-digits from both
periods. The Marine segment was up 20.9% sequentially, while
declining 14.3% from the year-ago quarter and contributed 9.5% to
total revenue. The decline from the year-ago quarter was on account
of weakness at both OEMs and in the after-market, which Garmin said
was because of the shrinking of the global marine electronics
Currently, Garmin Ltd. has a Zacks #2 Rank, implying a
short-term 'Buy' rating.
GARMIN LTD (GRMN): Free Stock Analysis Report
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