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Nearmap shares lower after announcing new acquisition

The Nearmap Ltd (ASX: NEA) share price is trading lower on Thursday despite an acquisition announcement.

At the time of writing the aerial imagery technology and location data company’s shares are down 0.5% to $2.58.

What did Nearmap announce?

This morning Nearmap announced the acquisition of the technology and intellectual property of US-based Pushpin.

Pushpin is a deep learning and analytics technology company that extracts data to provide roof geometry insights.

This technology will allow Nearmap to rapidly extract and disseminate roof geometry from its widescale 3D content and offer a new type of location intelligence to customers.

Nearmap’s CEO and managing director, Dr Rob Newman, said: “By acquiring Pushpin’s 3D geometry extraction technology and pairing it with our rich data, we bring the best of both worlds together at unprecedented scale.”

“Over the past couple of years, we’ve evolved our offering into a multi-product portfolio, and this acquisition is an important milestone in our approach to continue adding new content types for our customers,” he added.

What are the other benefits?

Management also notes that the new technology can provide a semi-automated calculation and extracted representation of any roof geometry within an hour. This significantly reduces the turnaround time.

Furthermore, the combination of 3D content from Nearmap and geometry extraction technology from Pushpin opens up a diverse range of use cases. This allows businesses to fast-track quoting and fulfilment of roofing projects, determine solar irradiance, plan drone delivery routes, and model 5G propagation.

How much is Nearmap paying?

Nearmap has agreed a fee of US$3.5 million for the assets. It notes that this is consistent with its commitment to accelerate growth opportunities through targeted and selective acquisitions.

It also expects the acquisition to provide further monetisation of its next generation HyperCamera2 content.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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