Identix name chosen in Visionics merger deal
MINNETONKA, Minn.-Visionics Corp. and Identix Inc. are moving closer to cementing their merger, a deal that would create one of the single largest biometrics companies in the market today.
In May, the two companies announced the combined company would be named Identix, along with a myriad of other changes. The merger is expected to be completed sometime this month, following shareholder approval.
The name selection comes as little surprise to analysts in the industry, who say the Identix name carries the largest brand recognition of the two.
"Probably the selection of the Identix name is because it has a much longer tradition in the biometrics space," said Jack Mallon, a security industry analyst and principal at Mallon & Associates. "Identix has been around almost 20 years."
Along with picking a company name, the two also announced plans to headquarter the business here and to close facilities in Los Gatos, Calif., where Identix was located, and in Dublin, Calif. The companies expected to lay off 120 employees, or 20 percent of its workforce.
The changes are part of the two companies' plans to move towards profitability, said Frances Zelazny, director of corporate communications for Visionics. "This is in line with growth objectives and getting to profitability," she said.
Neither company is profitable as a standalone entity, likely due to costs associated with marketing, saidÃ‚Â Brian Ruttenbur, senior vice presi-dentÃ‚Â andÃ‚Â an equityÃ‚Â research analyst with Morgan Keegan.
"These companies are just starting to get revenue traction," said Ruttenbur. "They have to spend a lot of money on sales and marketing. It's a brand new industry and they have to tell their story."
But Damon Wright, director of investor relations for Identix, said the changes will likely result in several million dollars of cost savings. He did not have specific numbers available by press time.
Once the deal is completed, Identix's Bob McCashin, who is now chairman and chief executive officer, will become chairman. Visionic's Chairman and Chief Executive Officer Dr. Joseph Atick will become president and chief executive officer of the company.