BIOSCRYPT INC. TO ACQUIRE A4VISION AND RECEIVE SUBSTANTIAL NEW INVESTMENT CAPITAL
Merger with A4Vision furthers Bioscrypt's leadership position in biometric access control for the enterprise; increased capital solidifies company's balance sheet.
Jan 23, 2007 - TORONTO, Jan. 23 /PRNewswire-FirstCall/ - Bioscrypt Inc. (TSX: BYT), a leading provider of enterprise access control technologies, today announced
that it has entered into an agreement to acquire A4Vision, Inc., a leading
provider of advanced identification systems using innovative
three-dimensional (3D) facial imaging and recognition technology. Bioscrypt
intends to add A4Visions’s 3D facial imaging and recognition technology to its
portfolio of biometric access control products. Bioscrypt will also
integrate the 3D facial technology with VeriSoft, its Identity and Access
Management solution, to extend the authentication factors supported for
both physical and logical access control and broaden its suite of Door to
Desktop(R) identity verification technologies.
The acquisition of A4Vision will position Bioscrypt as the only organization
capable of offering a converged physical and logical solution that supports
both finger and 3D face biometrics as authentication techniques for access
control. In addition, adding A4Vision's award-winning technology would enable
Bioscrypt to become the first company to offer off-the-shelf finished
readers for both finger and 3D face biometrics for use in physical access
control. This unique position will allow Bioscrypt to further establish
itself as the leading vendor of access control technologies to the
The acquisition will enhance Bioscrypt's revenue growth opportunities
by addressing additional markets. In a publication dated January 2007, the
International Biometrics Group projected that the facial recognition market
will represent more than US$1.4 billion or 19 percent of the US$7.4 billion
total Non-AFIS market in 2012. Fingerprint matching is predicted to be 25
percent or a US$1.85 billion market in 2012 for a combined market size of
more than US$3 billion in five years time.
Frost & Sullivan, an independent market analyst firm, stated in a July
2006 study that the compounded annual growth rate for facial biometric
technology will be 27.5 percent and that one of the two primary markets by
application for face recognition technology is physical access control/time
and attendance. Bioscrypt intends to use its existing sales channel, an
indirect partnership model that was instrumental in the company being
recognized by Frost & Sullivan as the 2005 Application Market Penetration
Leader for the world non-AFIS fingerprint physical access control/time and
attendance market, to sell the 3D facial technology to this considerable
"The acquisition of A4Vision further strengthens and underscores our
commitment to deliver the market-leading solution for identity-based access
control," said Robert L. Williams, President and Chief Executive Officer of
Bioscrypt. "Bioscrypt and A4Vision share a strategic view of the opportunity in
enterprise access control, further penetration of our existing positions in
government and financial services markets, and our respective commitments
to customer satisfaction."
A4Vision is the leading 3D facial imaging and recognition technology company.
By focusing on developing a 3D facial system from the outset, A4Vision has
overcome inherent limitations associated with facial recognition, such as
lighting and provides far superior matching rates than traditional 2D
systems. Like Bioscrypt, in addition to biometric verification, A4Vision has also
built their system to support multiple authentication technologies
including cards and PINs. Incorporated in 2001, A4Vision has been delivering
dedicated products and solutions to organizations in government and
financial services such as the US Department of Defense, the US Department
of Homeland Security, Pictet bank of Switzerland, New Jersey Transit, and
Denver Regional Transit District. Together, Bioscrypt and A4Vision will fully
support all of their current customers and products and will offer a
comprehensive upgrade path to a converged physical and logical access
"A4Vision's current customers and employees will significantly benefit from
the combined resources and technologies brought to the table by both
parties," said Grant Evans, Chief Executive Officer of A4Vision. "We believe that
during a time of industry consolidation, establishing a worldwide market
leader and platform will accelerate the realization of a significant market
for multi-factor access control and for the merged entity to be a global
leader of comprehensive and broad identification solutions."
The acquisition will be completed through the merger of A4Vision with
Bioscrypt's wholly owned US subsidiary, with the merged company to continue
as Bioscrypt, Inc. Pursuant to the merger, certain noteholders and
stockholders of A4Vision will receive an aggregate of up to 9.0 million Bioscrypt
common shares and warrants to purchase up to an additional 4.6 million
Bioscrypt common shares.
Concurrent with the completion of the merger, institutional investors
associated with A4Vision have agreed to invest between US$6 million and US$8
million in newly issued Bioscrypt common shares and warrants to purchase
Bioscrypt common shares. Following completion the acquisition and
financing, new and existing A4Vision investors, including EuroQube SA, In-Q-Tel,
Logitech, Menlo Ventures, Motorola Ventures, NTT Leasing Co. Ltd., TAKO
Ventures, and Wedge International, will own, on a fully diluted basis, up
to approximately 32% of the pro forma company.
Bioscrypt's Board of Directors will be expanded, with two members from
A4Vision's Board of Directors: Grant Evans, A4Vision's Chief Executive Officer,
and Douglas C. Carlisle, a general partner of Menlo Ventures.
The completion of the transactions are subject to required regulatory
and shareholder approval, as well as the satisfaction of certain customary
closing conditions. It is anticipated that closing will occur immediately
following the special meeting of shareholders of Bioscrypt relating to the
transactions scheduled to be held in early March.
"With the capital infusion and the acquisition of A4Vision and its 3D facial
technology, Bioscrypt has the balance sheet and suite of product offerings
to become the de facto standard for biometric access control" said Pierre
Donaldson, Chairman of Bioscrypt. "Bioscrypt has been executing on its
strategy of providing Door to Desktop access control technologies to the
market and we look forward continuing our accelerating momentum with these
Janney Montgomery Scott LLC advised Bioscrypt on this transaction and
provided a fairness opinion to the Bioscrypt Board of Directors in support
of the merger.
About Bioscrypt Inc.
Bioscrypt Inc. is a leader in identity verification technologies,
providing solutions for converged physical and logical access, enabling
unified authentication from Door to Desktop(R). Bioscrypt's offerings
simplify the task of implementing secure access to facilities, equipment
and IT networks. The company develops and sells biometric embedded
solutions, access control readers and identity and access management
software to protect the physical and network assets of international
government agencies and leading organizations in the financial services,
healthcare, and manufacturing sectors. More information is available at
Bioscrypt and Door to Desktop are registered trademarks and Veri-Series and VeriSoft are trademarks of Bioscrypt Inc. All other product and company names mentioned are the property of their respective owners and are mentioned for identification purposes only.
Forward-looking (safe harbour) statement
Statements made in this news release that relate to future plans,
events or performances are forward-looking statements. Any statement
containing words such as "believes", "plans", "expects" or "intends" and
other statements which are not historical facts contained in this release
are forward-looking, and these statements involve risks and uncertainties
and are based on current expectations. Consequently, actual results could
differ materially from the expectations expressed in these forward-looking
A4Vision (Applications for Vision) develops and licenses advanced identification systems and tracking solutions using 3D facial imaging and recognition technology.
A4Vision offers products through companies such as Ingersoll Rand, ADI, NTT Communications, Singapore Technologies, Sagem, Securitas, SITA, Thales, and global partners Motorola, Siemens, and Unisys. A4Vision is headquartered in California (USA) with offices in Geneva (Switzerland) and Moscow (Russia).
A4Vision has recently announced that it has entered into an agreement to be acquired by Bioscrypt (BYT.T), a leading provider of enterprise access control technologies. The combined entities will be the only organization capable of offering a converged physical and logical solution that supports both finger and 3D face biometrics as authentication techniques for access control. More details about this and other corporate information can be found at www.a4vision.com www.Bioscrypt.com
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