UK banknote-printer De La Rue to buy DuPont Authentication in £19.8m cash deal
British banknote manufacturer De La Rue is set to buy the authentication unit of DuPont Electronics and Communications in an all-cash deal worth 25 million US dollars (£19.8 million).
De La Rue said the acquisition of the Utah-based firm is in line with its five-year strategic plan, helping to "transform the group into a technology-led security product and service provider".
DuPont Authentication produces holographic films and software, while its technology is used to verify products such as identification documents and consumer electronics.
The acquisition - expected to be completed by year-end - will also help De La Rue create new verification tools for the currency market, the release said.
The American company currently employs around 40 people and is set to report full-year revenues of around 14 million US dollars for 2016.
De La Rue chief executive Martin Sutherland said: "Government and brand owners around the world are increasingly focused on protecting identities and their supply chains from counterfeiting and protecting both revenues and customers from illicit trade.
"This transaction will further enhance our position in this strategically important and growing market.
"DuPont Authentication's market leadership in holographic security features, technology expertise and production capabilities will complement our existing technology platform."
De La Rue's London-listed shares were higher by 2.2% in afternoon trading.
In its latest earnings report released in November, De La Rue said it was confident about its full-year outlook, despite flat half-year revenues of £189.5 million and a 31% drop in reported pre-tax profit to £17.2 million.
It turned attention to a "strong" 12-month closing order book worth £409 million, compared with £405 million in the previous 12 months.
Earlier this year, De La Rue clinched a deal to sell off its cash sorting machines business for £3.6 million as part of strategic plans to dispose of non-core units in the wake of intense competition and tough trading.
De La Rue was set receive £2.1 million from the sale and an additional £1.5 million on the first and second-year anniversaries of the deal.