Digimarc approves L-1's $310 million offer, ends talks with Safran

By Lisa Kerner

Charlotte, N.C., June 30 - L-1 Identity Solutions, Inc. signed an amended definitive merger agreement to acquire Digimarc Corp.'s ID Systems Business for $310 million in cash, up from L-1's original stock and cash offer of $250 million.

Digimarc's board of directors unanimously supports the new offer and recommends its stockholders tender into the offer, an L-1 news release noted.

In addition, Digimarc terminated discussions with Safran SA regarding its unsolicited non-binding indication of interest to acquire the ID Systems Business for $300 million in cash.

The tender offer is expected to begin by July 2 but no later than July 7, with the spinoff of the digital watermarking business to occur prior to the offer's end.

According to L-1, the transaction is slated to close in the third quarter of 2008 and will be financed through proceeds of a committed credit facility and private equity investments, including an investment by company chairman, president and chief executive officer Robert V. LaPenta.

"We believe that our all-cash offer is superior to the conditional, non-binding proposal from Safran SA and is a strong reflection of the intrinsic value of the business, its growth opportunities, and the synergies unique to the combination with L-1," LaPenta said in the release.

"The addition of Digimarc's ID Systems to L-1 would create an industry leader in secure credentials, biometric and authentication technologies and services," LaPenta added.

L-1's identity solutions are designed to protect personal privacy. The company is based in Stamford, Conn.

Digimarc is a secure identity solutions provider based in Beaverton, Ore.

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