Thales shares gain after successful, surprise bid for Gemalto

on Dec 18, 2017

Thales shares are trading higher mid-mornng Monday, following news over the weekend that it’s surprise bid for Dutch cybersecurity business Gemalto has been accepted. The deal comes soon after Gemalto rejected a bid from French digital business Atos.

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By 1000 BST, Thales shares were trading 7.83% higher at €93.03. Meanwhile, Gemalto shares had gained 5.50% to hit €49.40.

Full agreement from Gemalto

Thales has offered €51 per share for Gemalto. That values the company at $4.76 billion. It’s also above the €46 per share offer made by Atos, which Gemalto said “significantly” undervalued the business.

“The acquisition of Gemalto marks a key milestone in the implementation of Thales’s strategy,” said Thales Chairman and Chief Executive Officer, Patrice Caine.

“Together with Gemalto’s management, we have big ambitions based on a shared vision of the digital transformation of our industries and customers,” Caine added.

Meanwhile, Gemalto’s CEO Philippe Vallee, was equally upbeat on the deal.

“I am convinced that the combination with Thales is the best and the most promising option for Gemalto and the most positive outcome for our Company, employees, clients, shareholders and other stakeholders,” Vallee said in a press release.

The offer from aerospace and defence expert Thales, was met with complete support from Gemalto’s board of directors.

Global digital security plans

Gemalto is a major SIM card producer for mobile phones and also provides secure payment solutions for banks.

But that’s not all. Gemalto works in the online enterprise space, providing encrypted cloud services to businesses. And, it does some work in the growing Internet of Things sector, too.

The Thales, Gemalto deal will be the largest in Europe during 2017. It also highlights the ascendancy of the online security industry as data breaches become more common and potentially more damaging to businesses.

Once the deal is complete, Gemalto will continue to operate under its own brand. But, it will do so as one of Thales’ global business units. The purchase will add around €3 billion in revenues to Thales. It’s also estimated it will result in cost savings through synergies of up to €150 million, by 2021.