Forbes Markets
Deal Of The Day: Digital Biometrics, Visionics Merge

NEW YORK - Digital Biometrics, which builds digital fingerprint equipment, primarily for law-enforcement agencies, struck a deal today with privately-held Visionics, a face-recognition software maker. The companies are expected to announce the merger tonight.

Digital Biometrics (nasdaq: DBII) will issue seven million new publicly-traded shares as part of a stock-for-stock pooling of interests that will leave Visionics shareholders holding 30% of the merged company. Digital shares closed down $0.19 to $5.25 today, valuing the deal at roughly $37 million.

Digital earned $100,000 in 1999 on revenue of $22.2 million. Visionics declined to release any details about its finances.

Though Digital has focused on hardware, Visionics, which aims its products at banks, the travel industry and other markets, is making a push to facilitate Web security. "Visionics is going to be in the business of offering appliances that fit on the Internet and can be queried for transactions," says Joseph Atick , Visionics' chief executive. "Digital Biometrics adds tremendous expertise in the manufacture of these devices."

Atick will retain the CEO title, while Digital Chief Executive James Grange r will be the chairman of the combined company. The merged company will use the Visionics name. Digital officials could not be reached for comment.

The combined company will offer network appliances to support facial recognition and other biometrics. It will be co-headquartered in Jersey City, where Visionics is located, and in Minnetonka, Minn., where Digital is located.

Atick says that both boards have approved the deal, and that pending regulatory approval, it should be finalized in January.