Asset management technology provider I.D. Systems Inc. said today it has acquired Keytroller LLC, a manufacturer of electronic products for managing forklifts and other vehicles, in a deal that adds a line of mid-range and economy products to I.D. Systems' high-end industrial truck management systems.
Woodcliff Lake, N.J.-based I.D. Systems paid $9 million for Tampa, Fla.-based Keytroller, and could shell out an additional $3 million if Keytroller reaches certain growth targets over the next two years. The deal is expected to close before the end of July, following customary closing conditions.
I.D. Systems plans to retain Keytroller President Terry Wickman and other employees, operating the company's office in Florida under its current brand name as a separate subsidiary, I.D. Systems CEO Chris Wolfe said in an interview.
The acquisition will allow I.D. Systems to expand beyond its core client base of large global enterprises that buy its flagship PowerFleet industrial truck management systems, the company said. Keytroller rarely competes head-to-head with those PowerFleet devices, instead marketing most of its products through a large network of lift truck dealers to small and medium-sized end users, according to I.D. Systems.
By combining those complementary distribution channels, the merged companies will strengthen their combined position in the industrial truck management market, Wolfe said. The companies will now be able to sell through an array of channels, including I.D. Systems' direct sales to large enterprise clients, resale partners such as the forklift vendors Toyota Material Handling North America (TMHNA) and Mitsubishi Caterpillar Forklift America Inc. (MCFA) for midrange clients, and Keytroller's resale channels through independent dealers, he said.
In the long run, the companies intend to create a common software platform that allows clients to migrate between existing products from both firms, such as Keytroller's "Infomatics" software as a service (SaaS) fleet management software and I.D. Systems' "Vision Pro," Wolfe said.
Keytroller reported annual revenue of $6.6 million in 2016, compared to I.D. Systems' annual revenue of $36.8 million for the same year. I.D. Systems will include Keytroller revenue as part of its industrial truck management product line beginning in the third quarter of 2017, the company said.
"Keytroller's business complements our industrial truck management segment incredibly well, from product mix and market position to sales cycle and customer diversification," Wolfe said separately in a statement. "The acquisition should contribute immediately to I.D. Systems' revenue and profitability, as well as position the company to achieve a more predictable, profitable revenue stream from a much more diverse customer base."
An additional benefit of the deal is that acquiring Keytroller gives I.D. Systems a new source of industrial truck usage data for its PowerFleet IQ analytics database, enhancing the value of that tool for multi-site enterprises, according to I.D. Systems.