Viisage to acquire fingerprint-screening company
- By Dibya Sarkar
- Nov 16, 2005
Viisage, a Massachusetts-based biometrics company, announced yesterday that it will buy Integrated Biometric Technology (IBT), a company based in Nashville, Tenn., that provides fingerprint technology and criminal background and screening services for the commercial and government sectors.
This is the first acquisition for Viisage since L-1 Investment Partners, a private management investment firm based in Stamford, Conn., agreed to invest $100 million in the company.
According to a press release, L-1 will acquire 60 percent of IBT’s outstanding ownership interests for $35 million in cash and buy the remaining 40 percent on or before Jan. 30, 2006, for another $25 million.
When L-1 and Viisage complete their deal in December, Viisage will buy from IBT all of its outstanding stock for 5 million newly issued shares of prereverse split Viisage common stock. Viisage will then pay L-1 $35 million in cash to get ownership of IBT. “The transaction is expected to produce revenue in the $30 [million] to $35 million range and be accretive in 2006,” according to a press release.
Viisage officials expect the acquisition to strengthen its position in the market and allow the company to offer more end-to-end products. It will benefit from a multimillion-dollar contract that the Transportation Security Administration awarded IBT last year.
Under the contract, the company began processing the fingerprints of truck drivers who carry or want to obtain a hazardous-materials endorsement for extensive background checks as required by the USA PATRIOT Act of 2001. About 2.7 million commercial drivers transport hazardous materials, and company officials believe the contract could exceed $100 million.
“Identity solutions that combine leading face-recognition and fingerprint solutions with high-security credentialing technologies are increasingly in demand,” said Bernard Bailey, Viisage’s president and chief executive officer, in the press release.
“The addition of IBT’s expertise in fingerprinting solutions to our existing identity solutions platform is expected to be a very attractive solution for both existing and prospective customers,” he said. “By combining our two companies’ valuable management resources and assets at the federal and state level, along with IBT’s penetration into the financial services sector, we believe we are clearly positioning Viisage to achieve sustainable long-term growth.”