Apple has agreed to buy fingerprint reader AuthenTec Inc for approximately $356 million as the maker of iPhones and iPads looks to strengthen its digital security capabilities.

Apple’s acquisition comes as consumers use their smartphones for more and more daily activities, including shopping.

“As cell phones become essentially credit cards, consumers will look to secure them in the event of theft or loss. AuthenTec’s fingerprint sensors offer one way to secure handsets,” said Mr Raymond James analyst J. Steven Smigie.

AuthenTec said Apple Inc is paying $8 for each of its common shares, a 58 per cent premium to their closing price on Thursday.

AuthenTec’s stock jumped $3.25 or 64 per cent to $8.32 in yesterday’s afternoon’s trading, above Apple’s offer. That could suggest investors think there will be a higher bid for the company.

The deal was unanimously approved by AuthenTec’s board. It still requires approval from a majority of the holders of the Melbourne, Florida, company’s stock.

AuthenTec has about 44.5 million outstanding shares, according to FactSet.

A higher offer for AuthenTec is possible. In a regulatory filing, AuthenTec said it’s not allowed to actively seek out other offers, but it could hold talks with other parties before its stockholders approve Apple’s buyout terms.

If AuthenTec does wind up accepting a superior offer, it would have to pay a breakup fee of approximately $11 million.

(This article was published on July 28, 2012)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.