Today De La Rue announced that it is exiting the integrated identity documents market with a sale of its International Identity Solutions business for a cash consideration of £42 million. The buyer is HID Corporation Limited (“HID Global”), an ASSA ABLOY Group company. The deal price is agreed on a cash free debt free basis, payable upon completion.
Last year’s loss of the £490 million contract to produce the new UK passport to a Franco-Dutch firm Gemalto is a possible reason for the disposal. Despite calls to politicians to ensure that UK passports are printed by a domestic business, under EU competition rules, large public procurement contracts must be offered to companies across the bloc, and the price offering from Gemalto was more competitive.
HID Global will acquire De La Rue’s international identity solutions contracts, associated software, passport assembly facilities in Malta, and certain printing contracts of security documents such as visas and birth/death/marriage certificates. The agreement also includes De La Rue providing printing services to HID Global until March 2022. The ongoing UK passport contract is outside the scope of the agreement.
Following the sale, De La Rue intends to focus on more accessible markets of identity-related security features and components, hoping for better returns on investment and synergies with the Group’s core business.