Zwipe to cut $4M a year in streamlining plan to focus on biometric card partnership with Idemia
The Zwipe Board of Directors has approved a management proposal to streamline the company with a narrowed focus to reduce staff and operational expenses, in a move enabled by its recent strategic collaboration agreement with Idemia. Under that deal, the companies will co-develop a technology platform to reduce the complexity and cost of biometric payment cards by combining components onto a single chip.
Zwipe will have exclusive rights to sell the solution to manufacturers worldwide, while Idemia will retain ownership of the technology and offer it within its F.CODE payment card product.
The streamlining plan is expected to be fully implemented in November 2019, with related one-off costs included in Q4 results. It is expected to enable underlying annual savings of over NOK 40 million (US$4.38 million), with effects starting to be realized in Q1, 2020.
“The product roadmap streamlining that we are now launching has been made possible thanks to the strategic collaboration with Idemia on a disruptive technology platform. We believe this innovation is a game changer and a catalyst for growth in the industry,” comments Zwipe CEO André Løvestam.
“Zwipe’s streamlined roadmap enables simplifying and focusing the company, while maintaining competent capacity to support our customers. In combination with the announced 90 percent guaranteed rights issue, we see a clear path toward commercializing our technology, with the required capital resources to get to that point.”
The rights issuance is expected to raise up to $8.1 million to keep the company going through the commercialization of its biometric smart card technology, and Løvestam noted at the time that Zwipe would streamline its product roadmap.