SCM Microsystems Completes Merger With Hirsch Electronics Corporation
May 04 2009 - 3:06AM
PR Newswire (US)
FREMONT, Calif. and ISMANING, Germany, May 4 /PRNewswire-FirstCall/
-- SCM Microsystems, Inc. (Nasdaq: SCMM; Prime Standard, SMY), a
leading provider of solutions that open the Digital World,
announced today that it has closed its merger with Hirsch
Electronics Corp. The shareholders of both companies overwhelmingly
approved the transaction, which included the payment of cash and
the issuance of SCM common stock and warrants to purchase shares of
SCM common stock in exchange for the securities of Hirsch. The
merger closed on April 30, 2009, and Hirsch is now a wholly-owned
subsidiary of SCM. Each company's products and services will
continue to be marketed, sold and supported using their existing
brand names. "We see this merger as the completion of another
milestone in the successful business relationship that SCM and
Hirsch have been building together," said Felix Marx, chief
executive officer of SCM Microsystems. "We decided to combine two
industry leaders into a single powerhouse because we see the market
developing in the same way, we focus on serving our customers in
the same way, and we already know how to work together." Acquiring
Hirsch, a physical access solution provider and re-seller of SCM's
physical access readers, nearly doubles the size of SCM. SCM is a
leading global provider of readers that enable people to access PCs
and networks with smart cards containing authentication data and
other information. This is known in the industry as "logical
access." Hirsch was a pioneer of the access control market and is
now a top player in what is known as "physical access" - secure
entry to buildings, campuses, military installations and other
facilities. Following the merger, Lawrence Midland, Hirsch's CEO
and president and a director of Hirsch, has joined the Board of
Directors of SCM and has also been named an executive vice
president of SCM, heading up the new Hirsch business division. Also
joining SCM's board is Douglas Morgan, a former director of Hirsch
who was instrumental in launching Hirsch as a company and in
developing Hirsch's core technology. With the recent departure of
Dr. Hagen Hultzsch and Stephan Rohaly from the Board, SCM's Board
of Directors now consists of seven members, who together have
substantial and broad experience in the U.S. and European
technology markets. "Felix and I met about a year ago and found
within an hour that we shared the same vision. It was obvious to
both of us that Hirsch and SCM had significant and complementary
strengths," commented Lawrence Midland. "As a combined company, we
now have an exceptional opportunity to deliver a broader and more
complete set of solutions to address the growing market trend of
convergence - single, integrated authentication systems that
include both logical and physical access. The Hirsch team is
excited to join SCM and to participate in the expansion and growth
of our combined business." The merger also provides SCM with
additional scale and resources to develop, sell and support new
products, systems and services to address the growing global
appetite for secure authentication solutions to enable e-commerce,
e-government and e-business. In particular, SCM is focused on
another global market opportunity: authentication via "contactless"
smart cards and tokens. Among its other benefits, contactless
authentication enables consumers around the world to make daily
small purchases simply by holding up a card, token or mobile phone
equipped with contactless logical access technology. "Convergence
and contactless are bigger opportunities that need bigger suppliers
to fulfill them," Marx commented. "We are already talking with some
of the best-known global brands in communications and electronics
about next-generation products and services. These companies
understand and appreciate our strategy of building up our size and
scale while continuing to deliver standards-based solutions. Their
plans and programs depend on technology providers who can not only
keep up with, but anticipate their needs." The success of SCM's
strategy is also becoming evident in public-sector authentication
schemes. The Company is already producing and shipping specially
designed products for Germany's national "e-health" initiative,
which will give doctors and patients fast, reliable and even mobile
access to secure health information. Similar national programs are
in development or implementation around the world. In the U.S.,
Hirsch has included SCM products in its solutions for large-scale
authentication projects involving the military and government
agencies. The merger of the two organizations is expected to
require little integration because their existing operations are
highly complementary, with little overlap. "For a variety of very
practical reasons, we believe this combination has a high chance of
success," Marx noted. "We have already begun to execute on the
opportunity internally, and are excited to be able to do even more
for our customers than ever before." About SCM Microsystems, Inc.
SCM Microsystems is a leading supplier of solutions that open the
Digital World by enabling people to conveniently access digital
content and services at work, at home and in the marketplace. SCM
delivers the industry's broadest range of smart card reader
technology for secure authentication of individuals by computers,
networks and facilities. Through its wholly owned subsidiary,
Hirsch Electronics, SCM is a leader in IP-based physical access
solutions that integrate databases, devices, alarm systems and
surveillance systems. The company's customers include OEMs,
governments and enterprises worldwide. U.S. headquarters are in
Fremont, California; global headquarters are in Ismaning, Germany.
For additional information, visit the SCM Microsystems web site at
http://www.scmmicro.com/. Forward Looking Statements This press
release contains forward-looking statements within the meaning of
the Private Litigation Reform Act of 1995. These include, without
limitation, our statements contained above regarding potential
benefits and synergies of the merger, ease of integration of the
two companies and other statements that are not historical facts.
These statements involve risks and uncertainties that could cause
actual results and events to differ materially. For a discussion of
further risks and uncertainties related to SCM's business, please
refer to our public company reports and the Risk Factors enumerated
therein, including our Annual Report on Form 10-K for the year
ended December 31, 2008, filed with the SEC on March 31, 2009. SCM
undertakes no duty to update any forward-looking statement to
reflect any change in SCM's expectations or any change in events,
conditions or circumstances on which any such statements are based.
Note: The SCM logo is a trademark of SCM Microsystems, Inc and the
Hirsch logo is a trademark Hirsch Electronics or its affiliates in
the United States and certain other countries. DATASOURCE: SCM
Microsystems, Inc. CONTACT: Stephan Rohaly, +49 (89) 9595-5110, ,
or Darby Dye, +1-510-249-4883, , both of SCM Microsystems Web Site:
http://www.scmmicro.com/
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