Georgia-based EMS Technologies announced it is acquiring Formation for $40 million, assisting in the company's entrance into the in-flight Internet market. EMS, which already supplies hardware for in-flight connectivity services such as JetBlue's LiveTV, said the acquisition is part of a series of strategic buys to position the company in the mobile broadband and asset tracking markets. The acquisition would bolster EMS's aero-connectivity capabilities, enabling a far-reaching solution for passenger mobile access in the cabin, the company said.
Formation makes rugged servers and cabin Wireless Access Points (WAP's), which enable aircraft broadband systems to extend connectivity to laptops and PDAs. Formation's hardware supports in-flight communications regardless of whether the connectivity is through terrestrial or satellite-based networks. EMS is buying the company for $40 million but noted the price could increase by another $15 million based on Formation's performance in the coming years.
"EMS now has the capabilities to adapt products and technologies from one aero-connectivity application to another, enabling the company to get to market faster and more profitably than companies entering the market today," said Neil Mackay, EMS Technologies' executive vice president and chief operating officer.
The in-flight broadband space is beginning to heat up as Aircell's air-to-ground service lands on airlines such as Virgin, Delta and American. Other airlines such as Southwest and Alaska are looking to provide satellite-based services because Aircell can't be used on flights to Alaska, Hawaii or Mexico.
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