Over the weekend, one of the largest two-way radio manufacturers, JVCKenwood made a significant $10M USD investment into Sonim, an ultra-rugged phone manufacturer with sales around the world. Sonim sells Push-to-Talk Over Cellular (PoC) rugged phones for the mobile worker (Oil & Gas, construction, first responders etc) while Siyata Mobile Inc. (TSX-V:SIM | OTC PINK:SIMFF) focuses on the commercial fleet and vehicle market.
We view this as extremely positive industry news, and further evidence of the megatrend taking place to upgrade two-way radio hardware with Push-to-Talk Over Cellular devices.
Please find below a link to the news release, and notes from Paradigm Capital analyst Daniel Kim.
Daniel Kim, Paradigm Analyst Comments on Sonim Investment
Competitor news – positive inference for Siyata:
- JVCKenwood is one the leaders in land mobile radio (LMR) – this is the technology Siyata is displacing
- Sonim is one of the rugged device leaders (and like Siyata is a Kodiak partner providing push-to-talk-over-cellular (PoC))
- JVCKenwood announced it invested US$10M in Sonim for a “less than 10%” equity stake and a board seat (attached below). JVCKenwood’s motivation – to accelerate the development of LMR-to-LTE interoperability.
JVCKenwood clearly sees the writing on wall for its core LMR business i.e. push-to-talk-over-cellular (PoC) is coming and taking over. This was a very strategic move by JVCKenwood to hedge its bets. Recall Kodiak is the world’s leading PoC vendor with key partnerships with 5 handset vendors, each addressing specific verticals: Apple, Kyocera, Samsung, Sonim, and Siyata (https://kodiakptt.com/partners-and-ecosystem/handset-vendors.html). The partnership with Siyata targets professional fleets – trucks, buses, emergency vehicles and government fleets.
With the successful closing of its private placement ($5.1M @$0.40), the company has $5.0M in net cash and $9M in working capital. As the company was working capital constrained, funds will be used to accelerate deliveries to customers. Some of which will hit the very last weeks of Q1, but more so beginning in Q2.