Irvine-based Kofax plans to sell its hardware business to Germany-based private equity firm Hannover Finanz and certain members of the unit's management team. The company also is set to restructure its software business in Europe, the Middle East and Africa.
Kofax specializes in document-management software and hardware products. Its platforms streamline document-driven business processes by managing the capture, transformation and exchange of information found in paper, fax and electronic formats. The company's hardware business is a value-added distributor of imaging and archival storage products and a provider of maintenance and support to resellers in more than 40 countries in Europe, the Middle East and Africa.
Under the deal, Hannover Finanz will acquire certain legal entities, the Dicom brand and name, and a number of assets and liabilities of the hardware unit. The firm also will take on the employment of the unit's personnel, among other terms of the agreement. Kofax expects the transaction to be worth at least $20 million after tax, and the deal is slated to close in March.
"We’re very pleased to have effected this disposal in a manner that provides for the continuity of management, employees and key supplier and reseller relationships," said Reynolds Bish, CEO of Kofax. "We sincerely look forward to working with all of these parties as the business will continue to be an important value-added distributor of our Kofax VRS and Kofax Express software products in EMEA (Europe, the Middle East and Africa)."
Meanwhile, Kofax plans to restructure its software arm in Europe, the Middle East and Africa. The process includes consolidating its finance, accounting and other back-office operations – which are currently located in 10 locations throughout the region – into a single facility in Switzerland, among other changes. The restructuring is expected to result in yearly cost savings of at least $2.5 million starting in 2012.
"The proceeds from this transaction and the planned restructuring will better position us to focus on and further grow our software business revenues and earnings both organically and via our acquisition strategy," said Bish.
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