Watermarking Firm Digimarc Sells ID Unit for $250 Million

Authored by Mark Hefflinger on March 24, 2008 - 8:29am.

Billerica, Mass. - Digimarc (NASD: DMRC), an Oregon-based provider of digital watermarking and other technologies, announced on Monday that it will sell its ID Systems business to L-1 Identity Solutions, for about $250 million.

Under the terms of the definitive agreement, Digimarc stockholders will receive about 50% of the purchase consideration in shares of L-1 -- a company created by the combination of Viisage and Identix -- and 50% in cash.

"The synergies between our secure credentialing businesses make this a natural combination and one that will deliver great benefit to our customers and the industry," said Robert V. LaPenta, Chairman and CEO of L-1 Identity Solutions.

"Digimarc's expertise in centralized production of credentials, together with L-1's biometric recognition and document authentication capabilities, will enable us to provide a secure end-to-end solution for issuance of government credentials like driver's licenses."

Digimarc now intends to focus its efforts on its digital watermarking business.