Private equity firm Francisco Partners (FP) yesterday said it has acquired biometric technologies and systems developer and provider Cross Match Technologies, the only remaining pure play multimodal biometrics provider based in the United States.
Terms of the deal were not disclosed.
For FP, Cross Match is the only identity solutions-related company in FP’s portfolio. In the security space, FP also owns EF Johnson Technologies [EFJI], which provides secure communications solutions in the public safety arena, and WatchGuard, a network security firm.
Cross Match’s two key competitors in the market for multi-biometric capture devices have been acquired the past two years by larger firms. In 2010, 3M Corp. [MMM] acquired Cogent Systems and last year France’s Safran Group purchased the identity solutions business of L-1 Identity Solutions.
Cross Match was being pursued by larger integrators, but “we are the last remaining large independent biometric company in the world and I think that Francisco placed a value on that,” David Buckley, president and CEO of Cross Match, told Defense Daily. He also said it was important to remain a U.S.-based developer and manufacturer of biometric technology solutions.
FP is based in California.
Buckley said that overall integrators are probably pleased that Cross Match landed with a private equity firm, which means that the company’s technology will still easily be available as part of larger identity solutions offerings regardless of who the system integrator is.
In the United States, Cross Match’s biometric capture devices are used by Customs and Border Protection, the U.S. Army and Special Forces, the Navy, and by local law enforcement agencies. Last year, Cross Match was on a team led by GTSI Corp. [GTSI] that upset incumbent SAIC [SAI] to provide the Army’s Biometric Automated Toolset, which is used for enrollment and verification purposes.
Cross Match has also found success overseas, providing about 75 percent of the biometric capture devices in India’s Universal ID program, Buckley said. The company also sees expanding opportunities in South America, Africa, Europe and Japan, he said. Where corruption is “rampant” or where “voting matters,” more governments are turning to biometrics to weed out corruption, he said.
Following the Tsunami last year in Japan, which displaced hundreds of thousands of people without an easy means to verify their identities, there has been a push in that country to use biometrics in more applications, Buckley said.
In the commercial markets, biometric applications are being used increasingly in health care and finance, Buckley said.
Lazard served as Cross Match’s financial adviser on the deal.