Ingenico and Sagem in talks to merge e-payments units
26 July 2007 | 6275 views | 0
French eftpos vendor Ingenico and Paris-based technology firm Sagem Securite are in exclusive talks to merge their respective electronic payments businesses.
The proposed transaction concerns the payment terminals businesses of Sagem Securité - namely Sagem Monetel and Sagem Denmark - and would involve the issuance of new Ingenico shares to Sagem Securité, which is a unit of French aerospace and telecoms business Safran.
Ingenico says these shares would represent 25% of its business.
The two companies have signed a non-binding memorandum of understanding and will now enter a period of negotiations and due diligence.
Ingenico says completion of the transaction is expected by year end, subject to approvals from its shareholders and relevant competition authorities.
Commenting on the proposed deal, Ingenico's newly-appointed CEO Philippe Lazare, says: "Bringing together the activities of Ingenico and Sagem Securité would enable the new group to better grasp opportunities, in both the payment terminals and services areas, as the sector undergoes significant technological and regulatory changes."
Lazare became CEO of the eftpos group last week following the surprise exit of Amedeo d'Angelo who had been over-seeing the business since 2005. Lazare's appointment follows that of Jacques Stern who became chairman of Ingenico on 27 June 2007.
News of the proposed deal with Sagem Securité comes as Ingenico reports second quarter sales of EUR141.2 million, up 4.4% from EUR135.2 million a year earlier.
However overall first half revenues were disappointing, increasing just 1.9% to EUR260.1 million, from EUR255.2 million a year ago, due to a slow down in the US and a decline in Latin America.
But the group says it expects to see "strong sequential growth" in the second half, as well as a solid year-on-year performance.
The vendor says it also expects to report a solid rise in H107 profit compared to H206, and a reduction in net debt.