SCM Microsystems Announces Sale of Digital TV Solutions Business to Kudelski
April 06 2006 - 2:00AM
PR Newswire (US)
Company to Focus on Reader Business for Smart Card and Flash Media
Markets FREMONT, Calif., April 6 /PRNewswire-FirstCall/ -- SCM
Microsystems, Inc. (Nasdaq: SCMM; Prime Standard: SMY), a leading
provider of solutions that open the Digital World, today announced
that it has agreed to sell its Digital TV solutions business to the
Kudelski Group (SWX Swiss Exchange: KUD) for a total consideration
of $11 million in cash. The transaction has been approved by the
boards of directors of both companies, is subject to certain
closing conditions and is expected to close in the next 30 to 45
days. "SCM pioneered removable security for digital broadcasting
and has helped build a market for open systems in the digital TV
industry. Removable security modules will become a key enabler of
digital pay-TV services as the retail market continues to grow and
develop," said Andre Kudelski, Chairman and CEO of the Kudelski
Group. "The sale of our Digital TV business furthers our strategy
to consolidate and restructure our organization around a more
focused business model," said Robert Schneider, Chief Executive
Officer of SCM Microsystems. "With one headquarters and operational
center in Germany, one development facility in India and a seasoned
sales team in the U.S., we believe that we will be able to take
advantage of market opportunities more efficiently and cost
effectively. Going forward, we intend to put our entire attention
on leveraging our smart card and media reader businesses by
providing industry-leading solutions for emerging markets such as
e-health, e-passport, secure physical access, electronic payment
and digital photo printing." Under the terms of the agreement with
Kudelski, SCM will sell substantially all of the assets that relate
to its Digital TV solutions business, including its office building
in France, certain inventory, contracts, trademarks and
intellectual property. In addition, approximately 40 employees in
Europe and Asia are expected to join Kudelski's newly created
business focused on providing secure pay-TV modules compatible with
consumer electronic products for the digital TV industry. The
products that Kudelski is acquiring include SCM's DVB and
OpenCable(TM) compliant conditional access modules, used to
securely decrypt digital television broadcasts, as well as
controller chips used in set-top boxes that interface with the
decryption modules. Avondale Partners served as exclusive financial
advisor to SCM in connection with this transaction and rendered a
fairness opinion to the Board of Directors. About SCM Microsystems
SCM Microsystems is a leading supplier of solutions that open the
Digital World by enabling people to conveniently access digital
content and services. The company develops, markets and sells its
smart card reader technology for PC, network and physical access
and conditional access modules for secure digital TV decryption to
OEM customers in the government, financial, enterprise and
broadcasting markets worldwide. Global headquarters are in Fremont,
California, with European headquarters in Ismaning, Germany. For
additional information, visit the SCM Microsystems web site at
http://www.scmmicro.com/. About the Kudelski Group The Kudelski
Group (http://www.nagra.com/) is a world leader in digital
security. Its technologies are used in a wide range of applications
requiring access control and rights management, whether for
securing transfer of information (digital television, broadband
Internet, video-on-demand, interactive applications, etc.) or to
control and manage access of people or vehicles to sites and
events. The Kudelski Group is headquartered in
Cheseaux-sur-Lausanne, Switzerland, and its stock is listed on the
Swiss Market Index. Nagravision (http://www.nagravision.com/), a
Kudelski Group company, is the world's leading independent supplier
of open conditional access systems, DRM and integrated on-demand
solutions for content providers and digital TV operators over
broadcast and broadband platforms. Its technologies are currently
being used by more than 100 leading Pay-TV operators worldwide
securing content delivered to over 60 million active smart cards
and devices. NOTE: This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. These include, without limitation, our
statements regarding our expectations relating to the timing of the
completion of the sale of our Digital TV solutions business and our
ability to take advantage of market opportunities more efficiently
and cost effectively following the transfer of this business to
Kudelski and our concurrent consolidation of offices in our
remaining business. These statements are subject to risks and
uncertainties which may cause actual results to differ materially
from those contemplated herein. Some of the risks and uncertainties
that could cause our actual business and operating results to
differ include, but are not limited to, our ability to fulfill or
control the fulfillment of all conditions upon which closure of the
transaction is dependent; and our ability to improve our
operational efficiencies or reduce our operating costs through the
transfer of our Digital TV solutions business or the consolidation
of our headquarters into one location. For a discussion of further
risks and uncertainties related to our business, please refer to
our public company reports, including our Annual Report on Form
10-K for the year ended December 31, 2005 filed with the U.S.
Securities and Exchange Commission. NOTE: All trademarks are the
property of their respective holders. DATASOURCE: SCM Microsystems,
Inc. CONTACT: Darby Dye, Investor Relations-US, +1-510-360-2302, or
, or Manfred Mueller, Investor Relations-Europe, +49-89-9595-5140,
or , both of SCM Microsystems, Inc. Web site:
http://www.scmmicro.com/ http://www.nagra.com/
http://www.nagravision.com/
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