French defence firm Safran to buy L-1 Identity Solutions for $1.09 billion

State-owned French aerospace and defence contractor Safran Group today announced that it would acquire three units of L-1 Identity Solutions, a leading US-based identity management systems provider for $1.09 billion.

Paris-based Safran will acquire the operating and holding company of L-1 and it's biometric and enterprise access solutions, secure credentialing solutions and enrollment services businesses, which had 2009 revenue of $436 million and recorded a backlog of $1.1 billion at end of 2009.

''The transaction would create an industry-leading provider of solutions for the fast-growing high-tech homeland security market and generate strong growth in revenue and earnings, while yielding significant operating synergies,'' said Safran in a statement.

Safran said that prior to this agreement and as a pre-condition to the transaction, L-1 had entered into a definitive agreement to sell its government consulting services business for $295 million to a third party, and that this business would be excluded from the transaction with Safran.

Although the third party was not named by Safran, according to media speculation Britain's BAE Systems was the unnamed acquirer the rest of L-1.

Under the deal, L-1 shareholders would receive $12.00 per L-1 share in cash, a premium of 31.2 per cent over L-1's 30-day average closing price of $9.14 for the period ending on 17 September 2010.