VeriFone Holdings, a U.S. maker of point-of-sale payment terminals, has agreed to buy its Israeli counterpart, Lipman Electronic Engineering, for approximately US$793 million, in order to gain access to more wireless and IP payment technologies, the companies announced Monday.
The companies sell software and devices for processing payments by card—for example, at supermarket checkouts. VeriFone’s range includes terminals that can connect securely to central banking systems over phone lines, wireless connections or IP networks.
VeriFone hopes the acquisition will allow it to expand its share of the market for secure wireless and IP payment systems. Replacing dial-up technology with always-on IP networks can reduce the time it takes to process payments by removing the need to establish a connection for each transaction, while wireless systems make it easier to use electronic payment services in emerging markets with poor fixed-line telecommunications infrastructures.
The deal will make VeriFone the largest provider of payment systems in North America, it said. It expects to close the deal by the end of October.
The cash and stock offer values Lipman at about $793 million, based on Friday’s closing stock prices, and will lead to dual listing for the combined company on the New York and Tel Aviv stock exchanges.
VeriFone, of San Jose, Calif., reported adjusted net income of $49.7 million on revenue of $485.4 million in its fiscal year ended Oct. 31, 2005. Lipman, based in Rosh Haayin, Israel, reported net income of $20 million on revenue of $235.4 million for the year ended Dec. 31.
-Peter Sayer, IDG News Service
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