FREMONT, CA – Identiv (NASDAQ:INVE), Inc., a company specializing in computer peripheral equipment, has agreed to sell its physical security, access card, and identity reader operations, including its subsidiary Identiv Private Limited, to Hawk Acquisition, Inc., a subsidiary of French security solutions provider Vitaprotech SAS. The deal, announced on Monday, is valued at $145 million, subject to customary adjustments.
The sale, which was initially announced on April 2, 2024, includes the assumption of certain liabilities by the buyer. On Thursday, Identiv received confirmation from the Department of the Treasury that the Committee on Foreign Investment in the United States (CFIUS) has completed its review of the transaction and found no unresolved national security concerns.
Identiv expects the transaction to close within 30 days following the CFIUS clearance, subject to other customary closing conditions outlined in the Stock and Asset Purchase Agreement.
The company's decision to divest its physical security business comes as part of a strategic shift to focus on other areas of its operations. The proceeds from the sale are expected to provide Identiv with additional capital to invest in its core business segments and growth initiatives.
In other recent news, Identiv Inc. has been making strategic advancements in its operations. The company recently received final regulatory approval from the Committee on Foreign Investment in the United States (CFIUS) to sell its physical security business to Vitaprotech for $145 million.
This transaction, expected to close within the next 30 days, will significantly bolster Identiv's financial standing and provide the capital needed to expand its specialty IoT solutions business.
In financial updates, the company reported Q2 2024 results, exceeding consensus estimates for total company revenues, despite a decrease in IoT business revenue. The company is also transitioning RFID production from Singapore to Thailand in a bid to improve margins.
On the analyst front, Identiv is exploring strategic options such as mergers and acquisitions to drive growth, with a non-GAAP gross margin target of 30% or more set for the IoT business.
Despite a widened GAAP net loss of $6.9 million in Q2 2024, Identiv remains confident in achieving a compelling return on investment in new growth areas. These are recent developments in Identiv's strategic and financial journey.
InvestingPro Insights
In the wake of Identiv's recent transaction, current metrics from InvestingPro provide a clearer picture of the company's financial health and market position. With a market capitalization of $82.4 million, Identiv holds a Price to Earnings (P/E) ratio of -6.12, indicating that investors are expecting negative earnings. The company's revenue growth over the last twelve months stands at an impressive 36.16%, showcasing a strong increase in sales, despite a projected sales decline for the current year.
InvestingPro Tips highlight that Identiv holds more cash than debt on its balance sheet, providing a cushion for future investments or to weather economic downturns. Additionally, the company's liquid assets surpass its short-term obligations, indicating a healthy liquidity position. These insights are particularly relevant for investors considering the company's focus on core business segments following the divestiture of its physical security business.
For readers seeking a deeper analysis, there are additional InvestingPro Tips available, including insights into shareholder yield and the company's performance over various time frames. To explore these further, visit https://www.investing.com/pro/INVE.
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