Card Manufacturers: Call for Tenders for Oberthur’s Smart Card activities
- Four candidate investors now stand out among the offers to take up Oberthur’s card and identity businesses: PAI (most likely to win), Advent, Bain and One Equity. The sale, to be completed this summer, involves the complete identity activity (government IDs), as well as 60% of the smart card division (SIM, banks, etc.). These elements would amount to one billion euros.
- The group should now focus on banknote issuing (fiduciary business), the revenue of which increased by more than one third in 2010 and represents 14.5% of its total turnover. Facing a decrease of SIM cards average cost, Oberthur relies on this expanding market, boosted by security concerns.
- In 2010, it achieved 979 million euros turnover, 75% of which derived from its smart card division. The identity activity generates less revenue, about 100 million euros.
- In December 2010, Oberthur launched a bid on British De La Rue, world leader with 40% market share of banknotes and secure documents. The offer was finally rejected. Oberthur confirms that it no longer has such plans.
- From an organisational point of view, the current sale reverses the process launched in 2008 (bundling smart cards and fiduciary activities in one entity). Expected synergies may not have measured up to these ambitions.
- It is a strategic turn for the banknote manufacturer, purchased in 1984 by ex-BNP banker Jean-Pierre Savare. The family is understood to either ask to remain part of the shareholders (40%) in case of initial public offering, or to dispose of a pre-emption right. Candidate funds would also wish a purchase option on the entire capital –as is the case between Visa Europe and Visa Inc. In parallel, transmission is under way to Jean-Pierre Savare’s son Thomas.
See December 2010 and January 2011 Watches