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2016-12-13

Precise Biometrics: Precise Biometrics to acquire the business of NexID Biometrics - adding liveness detection to its industry leading fingerprint software solu

Precise Biometrics, a leader in fingerprint software, has entered into
an agreement to acquire the assets of NexID Biometrics, a specialist
in spoof mitigation and liveness detection solutions for the
biometric authentication industry, for 32 million SEK in cash. The
acquisition will enable Precise Biometrics to rapidly expand its
offering of fingerprint recognition software with liveness detection,
significantly increasing security and addressing customer demand for
fraud mitigation. The acquisition will create further conditions for
growth in the fast developing market for fingerprint technology.
Precise Biometrics intends to finance the acquisition through a
private placement of shares to be implemented as soon as possible.

Precise Biometrics strengthens position as leader in fingerprint
software

NexID Biometrics develops and licenses liveness detection software
that enables more secure fingerprint authentication by mitigating
spoof-related risks, such as fake fingers, significantly lowering the
risk for fraud. The acquisition will give Precise Biometrics access
to liveness detection software that stems from over 10 years of
research by world leading scientists on biometric spoof mitigation
and liveness detection, exclusive rights to a portfolio of a combined
11 proprietary and university-licensed patents awarded or under
review and a close working relationship with Clarkson University, one
of the leading institutions in biometric research.

The acquisition will enable Precise Biometrics to expand its offering
of fingerprint recognition software for mobile and embedded devices
with industry leading liveness detection, significantly increasing
the security for customers and end-users, while maintaining
convenience and ease-of-use. The acquisition will provide competitive
advantages, strengthen the company's position as the leader in
fingerprint software and create further conditions for growth in the
booming market for fingerprint technology.

"We have been monitoring NexID Biometrics for some time as they have a
powerful software solution for liveness detection. By integrating
NexID Biometrics software with our fingerprint matching technology we
will add anti-spoof functionality to our offering, providing enhanced
security that meets customer demand, addressing future security
requirements and emerging standards for biometric authentication",
said Håkan Persson, CEO of Precise Biometrics. "In addition to its
industry leading technology, NexID Biometrics will bring valuable
competence to our organization and will become vital in our efforts
to continue to innovate fingerprint software."

"The combination of organizational resources and technologies will
make for a strong contribution to the biometric authentication
industry, including greater convenience and security for consumers
making mobile payments with their smartphones", said Dr. Stephanie
Schuckers, NexID Biometrics CEO and Clarkson University faculty
member.

E-commerce and fraud increase the need for secure fingerprint
authentication

Convenience has been the main growth driver for fingerprint
authentication, which has developed from being a niche product in
2013 to becoming standard on most mobile devices. Market analysts
predict that the number of mobile devices with fingerprint technology
will double and reach more than 1.5 billion devices in 2020. The
growth in mobile payments and e-commerce has led to increased fraud,
which is expected to continue to grow, prompting payment providers to
mitigate fraud through improved security measures. This will lead to
security becoming a key decision factor when sourcing fingerprint
authentication solutions. By integrating fingerprint liveness
detection to identify fake fingers, Precise Biometrics adds increased
security to its fingerprint authentication solutions, addressing the
demand for convenient and secure fingerprint solutions.

Integration of industry leading capabilities will create substantial
synergies

NexID Biometrics is headquartered in Potsdam, New York State, USA and
has extensive experience from processing and analyzing fingerprint
images, and will become a vital part of Precise Biometrics research
and development. Precise Biometrics will continue NexID Biometrics's
close working relationship with Clarkson University, one of five
universities in the US Center for Identification Technology Research
(CITeR), with a research program that focuses on biometric
vulnerabilities and intelligence. NexID Biometrics CEO Stephanie
Schuckers is the current director of CITeR, and will take on a role
as advisor to Precise Biometrics on matters such as strategic
direction and product development.

The liveness detection software will be further optimized for mobile
devices and will, following completion of the acquisition, be
integrated in Precise BioMatch Mobile during the first half of 2017.
In addition to NexID Biometrics liveness detection software, Precise
Biometrics will get access to expertise in spoof creation and human
subject research. NexID Biometrics will also bring valuable sales
experience of biometric solutions and will become Precise
Biometrics's base for US operations, enabling the company to better
serve regional customers. Precise Biometrics expects to invest in and
grow its US operations.

NexID Biometrics estimated turnover for 2016 is 2.7 million SEK,
showing minor profits. The company will be integrated in Precise
Biometrics business area Fingerprint Technology, including three
full-time employees.

Terms and financing of the acquisition
The acquisition, which in addition to customary closing conditions is
only conditional upon regulatory consent pursuant to the Bayh-Dole
Act, is expected to close during the first quarter 2017.

For the purpose of financing the acquisition of NexID Biometrics and
maintaining Precise Biometrics's current financial position, the
board of directors intends to resolve, based on the authorization by
the 2016 annual general meeting, on a private placement of shares in
order to raise gross proceeds of approximately 50 million SEK. The
private placement is intended to be carried out as soon as possible
and Pareto Securities AB has been appointed as financial advisor in
connection with the contemplated private placement.

This information is information that Precise Biometrics AB is obliged
to make public pursuant to the EU Market Abuse Regulation. The
information was submitted for publication, through the agency of the
contact person set out below, at 8.00 CET on December 13, 2016.

FOR FURTHER INFORMATION, PLEASE CONTACT
Håkan Persson, CEO, Precise Biometrics AB
Phone; +46 46 31 11 05 or +46 734 35 11 05
E-mail; hakan.persson@precisebiometrics.com
ABOUT PRECISE BIOMETRICS
Precise Biometrics is a market leading supplier of solutions for
convenient and secure authentication of people's identity. We develop
and sell fingerprint software and mobile smart card readers that
provide the market's best user experience and security. Our solutions
are used hundreds of millions of times every day by people all over
the world and are marketed together with strong business partners.
For more information, please visit; http://precisebiometrics.com

ABOUT NEXID BIOMETRICS
With founders among the world's leading authorities on anti-spoofing
and biometric liveness detection, NexID Biometrics is a leading
software and technology supplier to the biometric-authentication
industry. NexID develops and licenses liveness-detection software
that enables fingerprint-scanning technologies to authenticate
scanned images more accurately, and with greater confidence, by
mitigating spoof-related risks. The company also provides testing and
analysis of fingerprint-scanning devices to identify existing
vulnerabilities to known spoofing strategies. For more information
please visit https://nexidbiometrics.com

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http://news.cision.com/precise-biometrics/r/precise-biometrics-to-acquir...
http://mb.cision.com/Main/128/2147461/602965.pdf

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