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ABQ’s Lumidigm acquired for more than $60 million

lumidigm

ALBUQUERQUE, N.M. — Albuquerque-based Lumidigm Inc., a homegrown biometrics identification firm, has been acquired by the world’s largest lock maker, Assa Abloy.

The Swedish firm, which bought Lumidigm through its Texas-based U.S. subsidiary HID Global, did not publicly disclose terms of the acquisition. But one Lumidigm investor told the Journal that Assa Abloy paid more than $60 million in the deal, which closed on Friday.

Lumidigm, which raised about $20 million in venture capital after launching in 2001, sells fingerprint scanners for secure identification worldwide that it built with technology originally developed at Sandia National Laboratories and the University of New Mexico.

HID Global wants to integrate Lumidigm’s technology into its ID security products and services, which include things like access card keys and secure personal credentials. It’s the prime contractor, for example, for the U.S. government’s permanent resident identification badges, or “green cards,” for immigrants.

HID hopes to improve its products with biometric identification, which is emerging as a key part of today’s secure ID industry, said Lumidigm board chairman Bob Harbour.

“HID is a worldwide leader in security solutions, but it doesn’t have in-house biometrics capability,” Harbour said. “Lumidigm will now fill that need for them.”

Lumidigm can help weave biometrics into HID identity and access cards, Harbour said. But it will also work to develop new smart-imaging systems, such as iris and facial scanners.

HID Global President and CEO Denis Hébert said such advanced systems can enhance HID’s impact on high-security industries like health care and financial services.

“The company has unique technology,” Hébert said in a statement. “(It) has achieved strong penetration in key emerging markets, including South America and Africa.”

Indeed, Lumidigm currently sells its scanners to many industries in the U.S. and other countries. That includes things like border and port entry identification, clocking entry and exit times for shift workers, and access by health professionals to pharmaceuticals and patient information.

In fact, in 2012 it began selling thousands of fingerprint scanners to Brazilian banks for use in ATM’s as a more secure replacement for PIN numbers and other ID access technology.

Thanks to HID’s global marketing network, Assa Abloy now projects Lumidigm revenue will reach $25 million this year. Lumidigm had stopped publicly reporting revenue in 2006 after reaching $2 million, but it said sales continued to grow by about 30 percent per year since then.

Market demand has increased because of Lumidigm’s particularly robust scanning technology, which uses flashes of light to read images from the surface and subsurface of skin. It reconstructs those images into a fingerprint.

Since the technology reads beneath the skin, it’s not impeded by surface contamination, such as water, dirt, grease or oil. That improves its accuracy compared with conventional biometric sensors, the company says. And, because the scanners can see a person’s capillary system, the device can’t be tricked by people using a prosthetic finger, or a digit from a corpse.

In January, HID relocated its world headquarters from California to Austin, Texas, where it opened a new, 250,000-square-foot operations center.

Nevertheless, all of Lumidigm’s 33 employees will remain in Albuquerque, Harbour said. In addition, HID will continue to contract Delta Group Electronics in Albuquerque to make Lumidigm’s precision optical equipment.

Venture investors who committed funds to Lumidigm, including EPIC Ventures and the International Venture Fund, will earn a substantial return on their commitments. That includes the New Mexico State Investment Council, which provided money to both EPIC and IVF to invest in local companies, and which directly invested $2 million in state money in Lumidigm through a fund managed by Sun Mountain Capital.

“We were fortunate to get a lot of venture capital support, much of it from New Mexico investors who took a chance on us as a raw startup,” said Lumidigm board chair Bob Harbour. “They believed in our technology and supported us in many ways. The sale will provide good returns for them.”


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