Report: Facebook scraps Waze acquisition plans
Facebook (NASDAQ:FB) has ended negotiations to acquire crowdsourced location services firm Waze, AllThingsD reports.
Earlier this month, Israeli business journals Calcalist, Ynet and The Market reported that Facebook and Waze entered talks late last year, agreeing on a price tag somewhere in the neighborhood of $800 million to $1 billion. Insiders said the two firms signed a term sheet and kicked off due diligence efforts, and TechCrunch later corroborated the reports, citing a source that said both Facebook and Waze privately confirmed the deal and the purchase price range.
Sources told AllThingsD that talks dissolved in recent days, however, due in part to disagreements over whether to keep Waze in Israel or relocate the business to the U.S. Facebook previously acquired two other Israeli startups, feature phone interface developer Snaptu (purchased for upwards of $70 million in March 2011) and facial recognition specialist Face.com (bought in June 2012 for between $50 million and $60 million), and in both cases brought them to U.S. shores.
Both Facebook and Waze declined to comment.
The Waze application assembles turn-by-turn GPS navigation, real-time traffic updates and social networking components to improve motorists' daily commute, with all map and traffic information originating via on-the-go users who keep the solution open on their mobile device. Users can also actively contribute reports about accidents, police traps and related hazards. More than 47 million drivers now use Waze across operating systems including Apple's (NASDAQ:AAPL) iOS and Google's (NASDAQ:GOOG) Android. Facebook presumably targeted Waze to bolster its location-based social media efforts, including check-ins and deals.
Google is one of several suitors also in talks to purchase Waze, Bloomberg reported last week, noting that Google could leverage the service to add a social component to its Google Maps platform--in addition, a takeover would also eliminate any competitive threat posed by Waze landing with another company. According to sources familiar with the matter, Waze is seeking an offer of more than $1 billion but may also raise a new round of venture financing and remain independent: Waze raised $30 million in late 2011 in a round led by Kleiner Perkins Caufield & Byers and Horizons Ventures Hong Kong.
Earlier this year, TechCrunch reported that Apple was in advanced negotiations to acquire Waze, but the publication later posted a follow-up article stating the deal was not happening, an assertion backed by other media outlets. A source familiar with Apple's thinking told CNet the rumors were "fabricated." This week, Apple CEO Tim Cook confirmed "We did not" make a bid for Waze.
- read this AllThingsD article
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