Google is near a $1 billion deal to acquire Israeli navigation app startup Waze, after the two companies agreed in principle to most terms, according to a report Sunday.
The agreement comes after talks between the Israeli company and Facebook collapsed, apparently over Waze's insistence that its research and development operations remain in Israel, according to Israeli web site Haaretz. Facebook had sought to fold the company's operations into its California headquarters and re-brand them as a Facebook product.
Waze's R&D center will remain in Israel for at least three years as will the company's CEO, Noam Bardin. Waze will retain its independent identity both as a company and as a brand, according to the site's sources.
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Facebook had offered about $1 billion for the Israeli company, but when its exclusive right to hold acquisition talks expired, Waze turned to Google. Google offered all cash, whereas Facebook's offer was to pay half the purchase price in cash and half in shares.
Waze is a crowd-sourced navigation device for drivers, which relies on information provided by its 47 million members to populate its maps. Google currently competes with Waze, and is heavily invested in its own navigation system, which includes the Google Street View satellite images. Teaming up with Waze would have enabled Facebook, which doesn't have a similar product, to challenge Google in this key area.
- Mergers, Acquisitions & Takeovers
- Social & Online Media