December 18, 2017 -
Thales will acquire Gemalto and merge the two companies to form a global business unit among the top three players in the digital security market with €3.5 billion in revenues, the companies announced.
The offer price of €51 per share or roughly €4.77 billion ($5.64 billion) from Thales represents a 57 percent premium over Gemalto’s December 8 closing price, and the all-cash offer was approved unanimously by both boards of directors.
“The acquisition of Gemalto marks a key milestone in the implementation of Thales’s strategy,” said Patrice Caine, Thales’s Chairman and Chief Executive Officer. “Together with Gemalto’s management, we have big ambitions based on a shared vision of the digital transformation of our industries and customers. Our project will be beneficial to innovation and employment, whilst respecting sovereign strategic technologies. We have a tremendous respect for Gemalto’s technological achievements, and our two Groups share the same culture and DNA. I would like to personally thank Gemalto’s management and Board of Directors for their unanimous support and I welcome warmly Gemalto’s 15,000 employees to our Group. By combining our talents, Thales and Gemalto are creating a global leader in digital security.”
The acquisition of Gemalto’s unique digital security portfolio positions Thales to provide end-to-end solutions to enterprises and governments, including security software, digital and physical credentials, and expertise in biometrics and multifactor authentication.
“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,” added Philippe Vallée, Gemalto’s Chief Executive Officer. “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.”
Thales expects the merger to generate EPS gains in the mid to high teens in its first year. Gemalto is advanced in its transition to the government, enterprise security, and industrial IoT markets and is poised for significant growth, according to the announcement, while Thales expects cost synergies of €100 to €150 million by 2021.
The deal is subject to the usual conditions, and is expected to close in the second half of 2018.
Gemalto turned down an acquisition offer at €46 per share from Altos earlier this month.