TORONTO and VANCOUVER – Two Canadian based telematics providers have reached an agreement to merge, creating a company with more than 150,000 subscribers across Canada and the U.S.

BSM Technologies Inc. a provider of remote monitoring, fleet management, and fleet diagnostics systems; and Webtech Wireless Inc., which provides GPS fleet management systems, said on Thursday they have entered into a definitive agreement creating a company worth $85 million.

The deal, which has been approved by both company’s board of directors, calls for BSM to acquire all of the outstanding Webtech common shares for $0.52 in cash plus 2.136 BSM common shares for each Webtech common share. When completed. existing BSM and Webtech shareholders will own approximately 51% and 49% of the combined company, respectively.

“We are very excited about the potential to deliver accelerated growth, unlock financial leverage and establish a dominant position in targeted telematics verticals,” said Aly Rahemtulla, president and CEO of BSM.

According to a news release, both BSM and Webtech have adopted a “vertical focus in their respective go-to-market strategies. BSM’s strong presence in rail will be complemented by Webtech’s success in the government and trucking verticals.”

The combined company will be headquartered in Toronto and will operate under the name BSM Technologies Inc. It’s estimated the merger will give it $58 million total annual revenue, including $37 million in recurring subscription revenue.

Andrew Gutman, chairman and CCO of Webtech will become chairman of BSM, following the closing of the transaction. The executive management team will continue to be led by Rahemtulla, while Louis De Jong will continue as the chief financial officer.

The deal, expected to close by the end of September, still faces shareholder and regulatory approval.