Apple buying AuthenTec for about $356 million

Jul 27, 2012
Apple has bought mobile security firm AuthenTec for around $350 million, giving the gadget maker technology including data protection and fingerprint security for mobile devices.

(AP) — Apple has agreed to buy fingerprint reader AuthenTec Inc. for approximately $356 million as the maker of iPhones and iPads looks to strengthen its digital security capabilities.

Apple's acquisition comes as consumers use their smartphones for more and more daily activities, including shopping.

"As cellphones become essentially credit cards, consumers will look to secure them in the event of theft or loss. AuthenTec's fingerprint sensors offer one way to secure handsets," said Raymond James analyst J. Steven Smigie.

It's not known what Apple's plans are. Rival devices running Google's Android system are starting to come with a wireless technology that can let phones make payments with the tap of a reader. Apple's patent filings hint at an interest in the technology, known as near-field communications, but the notoriously secretive company has given no clue when the technology might show up in iPhones. A new model is expected this fall.

Beyond protecting payments, a fingerprint system could keep unauthorized people from accessing email, contact lists and more. Current phones offer protection through passwords, which can be guessed or forgotten.

AuthenTec said Apple Inc. is paying $8 for each of its common shares, a 58 percent premium to their closing price on Thursday.

AuthenTec's stock jumped $3.27, or 65 percent, to $8.34 in Friday afternoon trading, above Apple's offer. That could suggest investors think there will be a higher bid for the company.

The deal was unanimously approved by AuthenTec's board. It still requires approval from a majority of the holders of the Melbourne, Fla., company's stock. AuthenTec has about 44.5 million outstanding shares, according to FactSet.

A higher offer for AuthenTec is possible. In a regulatory filing, AuthenTec said it's not allowed to actively seek out other offers, but it could hold talks with other parties before its stockholders approve Apple's buyout terms.

If AuthenTec does wind up accepting a superior offer, it would have to pay a breakup fee of approximately $11 million.

While Apple said earlier this week that its growth rate slowed in its latest quarter, massive sales of its iPhones and iPads in recent years have made it the world's most valuable company. It's the third-largest maker of cellphones, according to research firm Gartner, and dominates the market for tablet computers.

Shares of Apple, which is based in Cupertino, California, added $10.23, or 1.8 percent, to $585.11.

Explore further: Verizon 1Q profit surges on Vodafone-related gains

2.7 /5 (6 votes)
add to favorites email to friend print save as pdf

Related Stories

Security holes discovered in iPhones, iPads

Jul 08, 2011

A new security hole has opened up in Apple Inc.'s iPhone, iPad and iPod Touch devices, raising alarms about the susceptibility of some of the world's hottest tech gadgets to hacker attacks.

Apple, Google to attend hearing on mobile privacy

May 16, 2011

US lawmakers have invited Apple, Facebook and Google to attend a hearing on mobile phones and privacy on Thursday -- the second Capitol Hill appearance in a week for executives from Apple and Google.

Recommended for you

Bitcoin exchange MtGox to start liquidation process (Update)

5 hours ago

Failed Bitcoin exchange MtGox, whose spectacular collapse hammered the digital currency's reputation, is to be liquidated after a Japanese court on Thursday ordered the start of bankruptcy proceedings, said a lawyer appointed ...

SK Hynix posts Q1 surge in net profit

6 hours ago

South Korea's SK Hynix Inc said Thursday its first-quarter net profit surged nearly 350 percent from the previous year on a spike in sales of PC memory chips.

Zynga founder Pincus leaving operations role

17 hours ago

Online game maker Zynga says company founder Mark Pincus is stepping down as chief product officer, less than a year after he was replaced as the company's CEO.

User comments : 0

More news stories

New breast cancer imaging method promising

The new PAMmography method for imaging breast cancer developed by the University of Twente's MIRA research institute and the Medisch Spectrum Twente hospital appears to be a promising new method that could ...

Research proves nanobubbles are superstable

The intense research interest in surface nanobubbles arises from their potential applications in microfluidics and the scientific challenge for controlling their fundamental physical properties. One of the ...

Using antineutrinos to monitor nuclear reactors

When monitoring nuclear reactors, the International Atomic Energy Agency has to rely on input given by the operators. In the future, antineutrino detectors may provide an additional option for monitoring. ...