A pedestrian checks his mobile phone while walking past a Verizon Wireless store in San Francisco, California, U.S., on Wednesday, April 15, 2015.
David Paul Morris — Bloomberg via Getty Images
By Reuters
August 1, 2016

Verizon Communications said it will buy GPS vehicle tracking company Fleetmatics Group for about $2.4 billion in cash to expand into the connected vehicle and fleet management market.

Verizon, the No. 1 U.S wireless company, (vz) will pay $60 per Fleetmatics share, a premium of about 40% to Friday’s close. The deal is expected to close in the fourth quarter of 2016.

Fleetmatics, which has its North American headquarters in Waltham, Massachusetts, develops software that shows fleet operators vehicle location, fuel usage, speed, and mileage, and other data on their mobile workforce, Verizon said.

As the market for smartphones and mobile devices gets saturated, Verizon and its biggest rival AT&T (t) are hoping that connecting more objects and appliances to their networks will provide new revenue.

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Fleetmatics shares soared 39% to $59.66 in premarket trading.

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