Aluf Holdings is looking to add two more biometric tech companies to its portfolio after sending non-binding Letters of Intent to acquire outstanding stock. The additions would represent the third and fourth companies that Aluf has acquired since the Board of Directors announced a new mergers and acquisitions strategy earlier this year. The first was COLOTRAQ, and Aluf also has a pending CSPA for another unspecified company.
The latest targets reflect the biometric and blockchain technology that Aluf is pursuing as part of its acquisitions strategy. One is a California provider of biometric sales and services, and the second is the developer of a multi-factor biometric authentication platform. A third target for acquisition is a Software-as-a-Service company that specializes in program management solutions.
The total cost of the new acquisitions is expected to be somewhere in the neighborhood of $34 million, including $19.4 million in cash, $12.1 million in unsecured sellers notes, and $3 million worth of Aluf Holdings stock. The cash will be procured through debt financing and “a Reg. D private placement under Section 506(c),” according to a statement from Aluf Holdings.
“The consummation of these acquisitions will immediately transform Aluf into a much larger company with annual revenues of approximately $39 million,” said Aluf President and CEO Dany Bouchedid. “We are thrilled to enhance the company’s current and future valuation as we execute the vision of becoming a leader in Next Gen technology.”
Aluf is particularly bullish on the prospects for the two biometrics companies, noting that the first has enjoyed $10M in annual gross revenues for the past five years. Aluf expects the global biometrics market to be worth $14.6 billion by 2023, though other predictions are even more robust. For example, Zion Market Research valued the market at $17 billion in 2018, and expects that to climb to $59 billion by 2025.
December 10, 2019 – by Eric Weiss