Thales to acquire Gemalto for €4.8 billion and lead digital security
In the agreement, Thales is to pay €51 per Germalto’s share cum dividend (a premium of 56% over the 1-month volume weighted average price), totalling €4.8 billion.
According to Thales’s Chairman and Chief Executive Officer Patrice Caine, the acquisition of Gemalto is a key milestone in the implementation of Thales’s strategy to become a global leader in digital security.
“I am convinced that the combination with Thales is the best and the most promising option for Gemalto and the most positive outcome for our Company, employees, clients, shareholders and other stakeholders. We share the same values and Gemalto will be able to pursue its strategy, accelerate its development and deliver its digital security vision, as part of Thales”, said Philippe Vallée, Gemalto’s Chief Executive Officer in a joint company statement.
Over the past three years, Thales has significantly increased its focus on digital technologies, investing over €1 billion in connectivity, cybersecurity, data analytics and artificial intelligence, in particular with the acquisition of Sysgo, Vormetric and Guavus.
The integration of Gemalto reinforces Thales’s digital offering across its five vertical markets (aeronautics, space, ground transportation, defence and security). Altogether, this new business unit will represent about 20% of pro forma Group revenues and rank among the top three players worldwide, with €3.5bn revenues in the fast growing digital security market.
Combined with Gemalto’s unique leading digital security portfolio, Thales expects to be ideally positioned to offer an end-to-end solution, to secure the full critical digital decision chains, from data creation in sensors to real-time decision making.
With this acquisition, Thales adds over €3bn of revenue to its digital business sales and acquires a set of technologies and competencies that have applications in all of Thales’s five vertical markets. The combination creates a powerhouse with a solution portfolio including security software, expertise in biometrics and multifactor authentication and the issuance of secure digital and physical credentials. Thales will combine its digital businesses into Gemalto, which will continue to operate under its own brand as one of the seven Thales global business units. Philippe Vallée will lead the combined digital security business.
The combined Group will have more than 28,000 engineers, 3,000 researchers, and invests more than €1bn in self-funded R&D, it expects the merger will generate pre-tax cost synergies of €100m to €150m by 2021.
Although all parties agreed to the merger, Gemalto may still accept a competing offer, should it exceed the current offer price by at least 9%.
The transaction is expected to close in the second half of 2018.
Gemalto – www.gemalto.com
Thales – www.thalesgroup.com
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