NEW YORK (MarketWatch) – Identix Inc. and Viisage Technology Inc. agreed to combine Thursday in a merger of biometric-security-technology developers valued at roughly $770 million.
The transaction values each share of Minnetonka, Minn., Identix at 0.473 share of Viisage.
The news sent the companies’ equities in opposite directions. Identix
shares rose 22% to close at $6.95 while Viisage’s
stock slumped 5.8% to $16.67.
The $770 million price tag is based on Viisage’s Jan. 11 closing price of $17.69.
The boards of both companies have approved the deal, which is expected to close in the second quarter. After the merger, Identix shareholders will own 59% of the combined company with Viisage’s holders owning 41%.
Robert LaPenta, Viisage’s chairman, will serve as chairman and chief executive of the combined company. Joseph Atick, Identix’s CEO, will be vice chairman and chief strategic officer.
The board will consist of 12 members, seven designated by Viisage and five by Identix. The combined company will be headquartered in Stamford, Conn.
The companies plan to evaluate alternatives for buying back stock once the deal is closed. The options include the potential issuance of convertible debt.
For calendar 2006, the companies forecast pro forma revenue of $220 million for the combined entity, with earnings before interest, taxes, depreciation and amortization of at least $40 million.
Viisage, Billerica, Mass., known principally for its facial-recognition technology, posted third-quarter 2005 revenue of $14.3 million. Identix makes the Live Scan fingerprint-identification systems, among other products. It reported revenue of $22.7 million for its fiscal first quarter, ended in September.
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