Diebold Inc., the card-based transaction services company specializing in security systems, announced that it will pay $20 million to acquire a formidable competitor in the college campus-card market, Griffin Technology Inc.
By purchasing a 20-year veteran of the college market, Diebold hopes to gain a bigger share of a business it entered just two years ago.
Farmington, N.Y.-based Griffin Technology has installed its card system on 250 college campuses, Diebold on 40.
Overall, though, Diebold is much bigger. It had revenues of $760 million last year; Griffin's revenues for the year that ended this June 30 totaled $18 million.
Canton, Ohio-based Diebold said it will pay $7.75 per share to buy all of Griffin's issued and outstanding shares.
"Griffin gains by affiliating with Diebold a much larger company with capital to finance new products and geographic expansion of campus card systems," said Robert S. Urland, president and chief executive of Griffin in a prepared statement.
A spokesman for Diebold said that Griffin brings significant market penetration, while Diebold's expertise is technology.
Both companies provide colleges with card technology that allows students to do a number of things with one card, for example, to access various buildings on campus with a photo identification card, to participate in meal programs, and purchase items from vending machines.
Some of the advanced technology that the companies are developing include using the cards to register for classes, accessing transcripts, and bank accounts.
Diebold is one of Citibank's partners in introducing such technology to the State University of New York, which is the largest higher education school system comprised of 64 universities, four and two year colleges.
Kevin Mullen, administrator of the National Association of Campus Card Users, believes that the Diebold-Griffin acquisition is part of a larger trend in the campus card market. Large companies like AT&T, and American Express, also purchased smaller companies in this business and are now offering a wide range of services on one card, eliminating the need for colleges to use several vendors.