Acquisition of Certain Assets

RNS Number : 3484M

Spectra Systems Corporation

17 September 2012

 



For immediate release                                                                                                                              17 September 2012

Spectra Systems Corporation

("Spectra")

Acquisition of certain assets from Lapis Software Associates (the "Lapis ICS Business")

Spectra Systems Corporation, a leader in machine-readable high speed banknote authentication, is pleased to announce that it has acquired certain assets of Lapis Software Associates ("Lapis"), including, importantly, their proprietary source codes, multi-year contracts (now in the process of re-assignment to Spectra) and long-standing customer relationships. Consideration for the acquisition is $0.75 M in cash payable upon completion.

Lapis,  headquartered in Parsippany, New Jersey, USA, is a leader in the gaming software industry and has a 15% worldwide market share of the secure Internal Control Systems (ICS) segment primarily with USA state lotteries including Colorado, New Hampshire, Iowa and Vermont.   ICS is a secure, high speed data platform which plays a critical independent security role in auditing online and many other gaming systems. ICS provides tools for fraud detection, money laundering, match fixing, and statistical analysis and has many existing parallel applications used by the securities exchange industry. The Lapis ICS Business contracts are multi-year and its independent services are used to verify the accuracy of transactions logged by providers of lottery services worldwide, including GTECH, Scientific Games and Intralot.

In the year ended 31 December 2011, the Lapis ICS Business generated approximately $0.35 M in revenue from eight separate customers. The Directors understand that this would have resulted in 2011 gross profits of approximately $0.2 M based on the 2012 the prevailing cost structure.

Commenting, Nabil Lawandy, CEO of Spectra, said:  "The acquisition of the Lapis ICS Business adds to the international customer list we acquired in the ICS area when we recently purchased the majority of ESI Integrity's assets.  We expect to be able to support all of the Lapis customers with the resources acquired from ESI Integrity and believe that this will result in a highly net income accretive transaction once the technology is fully transferred.   With the acquisition of the Lapis ICS Business, Spectra will have over 30% market share in gaming applications of ICS and will be one of the two remaining major suppliers providing such security technology to lotteries worldwide."

Spectra will issue its interim accounts for the six month ended 30 June 2012 later this month.

Enquiries:

Spectra Systems Corporation

Dr. Nabil Lawandy, Chief Executive Officer                                         Tel: [phone]

WH Ireland Limited

Chris Fielding (Head of Corporate Finance)                                        Tel: [phone]

Media Enquires:

The Communications Portfolio Limited

Philip Ranger / Caolan Mahon                                                                   Tel: [phone] / 2029 [e-mail]

 

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