Ituran Location and Control Ltd. (Nasdaq:ITRN); TASE:ITRN) has signed an agreement with General Motors Brazil, which will offer its customers Ituran's immobilization, location and telematics services for its Chevrolet cars. Ituran signed the deal through a subsidiary in which it owns 51%. Ituran will not carry out the installation and sale of the anti-theft devices.
Brazil's new Supplementary Law Contran no. 245 mandates that, beginning in August 2012, all new vehicles must include an anti-theft device. Ituran said that it cannot estimate its revenue or profits from the GM Brazil agreement, as the new law has not yet come into effect, but says that the agreement is "of significant importance", since when the law comes into effect, it may be of substantial financial scope.
Ituran CEO Eyal Sheratzki said, "This agreement with GM is an important milestone for our business in Brazil. We see significant future upside potential from this agreement once Regulation 245 becomes effective. We look forward to working with this leading global car manufacturer and we hope to build a long-term, successful and fruitful relationship with GM."
Ituran's share price rose 0.3% in premarket trading on Nasdaq today to $13.57, giving a market cap of $284 million, after rising 5.1% on the TASE to NIS 52.95.
Published by Globes [online], Israel business news - www.globes-online.com - on April 9, 2012
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