Setec is to be sold to Luxembourg

Smart card and passport maker anticipates fusion will bring extra jobs

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The Finnish maker of smart cards and security recognition technology, Setec Oy, is to be sold to a Luxembourg-based provider of smart card-based solutions,Gemplus International S.A. Following the closing of the transaction of EUR 96.5 million, Gemplus will own 100% of Setec.
      CapMan and other owners are selling Setec at a good profit. "We are very satisfied with the sales price", says Petri Niemi, Head of CapMan Technology, who is also the Chairman of Setec's Board of Directors.
     
Finnish Setec is the world's leading company in the biometric passport business. A biometric passport contains a microchip which improves the security of authentication, as it carries the passport holder's biometric identification in an electronic form.
      In the near future, most major industrial countries are likely to issue biometric passports. For example, a biometric passport will soon be needed to enter the USA without a visa. Hence, even the EU is soon to adopt such passports.
     
This also means that the sales of passports will increase in the next few years. According to Pekka Eloholma, CEO of Setec: "Thanks to biometrics, the value of the world's passport markets will grow significantly, maybe even doubling."
      "For Setec this is an opportunity to benefit from the size of its new owner, and hence, to promote its technology and products effectively worldwide", says Eloholma.
     
Gemplus is the world's leading provider of smart card-based solutions, including SIM cards for mobile phones. Hence the acquisition of Setec complements its activities.
      The synergies between Gemplus and Setec are significant.
     
The deal is an important chapter in Finnish economic history, as Setec was founded in 1885 as the printer for the central Bank of Finland.
      In 1991, it became an independent company and was named Setec. The Bank of Finland was its sole owner until 1998, when 60% of the company was sold to the Finnish National Fund for Research and Development (Sitra), Finnish Industry Investment Ltd, Varma Mutual Employment Pension Inurance Company, and Sampo Life Insurance.
      In 2003, the Bank of Finland sold the remaining 40% to CapMan, a leading private equity investor in the Nordic countries.
      Jacques Seneca, Executive Vice President, Identity and Security, Gemplus, will be appointed Chairman of Setec while Pekka Eloholma will remain Chief Executive Officer of Setec.
     
The deal is not expected to lead to any layoffs in Finland. On the contrary, Setec being such a vital part of the group, it is likely that more vacancies will be opened up, says Eloholma.
      The transaction is subject to regulatory clearance and is expected to be closed in June 2005.
     
For further information, see the web sites below.


Links:
  SETEC
  CapMan
  Gemplus News

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