Wednesday, 12 Jun 2019 11:12 GMT

De La Rue exits identity market in £42m sale

De La Rue has announced the sale of its identity solutions business, which will see the buyer take on printing contracts of security documents including visas and birth, death and marriage certificates.

HID Global has agreed to purchase the business for a cash consideration of £42m on a cash free, debt free basis, payable upon completion of the sale.

The security print company, which recently announced the departure of chief executive officer Martin Sutherland, says the sale will allow De La Rue to refocus on identity-related security features and components to “maximise technology and customer synergies with the rest of the group”.

The terms of the sale will see HID Global acquire De La Rue’s international identity solutions contracts, associated software, passport assembly facilities in Malta and some printing contracts of security documents.

The agreement also includes De La Rue committing to providing printing services to HID Global until 2022.

… we believe that exiting the end-to-end identity solutions market is the right one for the group

De La Rue’s contract to print UK passports, which ends in October 2019, is outside of the scope of the agreement.

Departing CEO Martin Sutherland comments: “After assessing all options, we believe that exiting the end-to-end identity solutions market is the right one for the group and will deliver the most value to shareholders.

“Focusing on the identity-related security features and components is in line with our strategy to transform De La Rue to an asset light and more technology-led business. This transaction strengthens our balance sheet and allows us to focus on the other strategic growth areas of security features, polymer, and PA&T.”

De La Rue expects the sale to be completed within the calendar year and hopes it will strengthen the balance sheet to provide it with more flexibility in investing in other growth areas.

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