Gemalto is going to buy 3M’s Identity Management business, which includes 3M Cogent, the latter’s biometric security arm. The companies are in direct negotiations now, with the acquisition expected to close in the first half of 2017 to the tune of $850 million.
In a statement announcing the acquisition, Gemalto highlighted 3M Cogent’s activities in law enforcement, border security, and civil identity, and lauded its “proven biometrics algorithms” in fingerprints, facial and iris biometrics, and beyond. Gemalto also noted that 3M’s business brings in annual revenues of about $215 million USD and profits of $58 million USD; and the company suggested that “the acquired business revenue is expected to grow at +10% CAGR with EBITDA margins above 20% by 2020.”
The acquisition may be indicative of a broader M&A trend in the growing biometrics industry. Earlier this year, Gemalto was rumored to be in the running to buy Safran’s Identity & Security arm, with Safran ultimately selecting Oberthur Technologies for exclusive negotiations also expected to close next year.
For its part, Gemalto should become a considerable powerhouse with the addition of 3M’s identity management business, and is already in a strong position having brought in €391 million in revenues last year, with major new business projects in the pipeline.
[An earlier version of this article erroneously reported that Gemalto was acquiring 3M’s Traffic Safety and Security Division. The text has been updated for accuracy.]
December 9, 2016 – by Alex Perala