The North Canton, Ohio, automated teller machine and security system vendor Diebold Inc. has agreed to sell its college campus card systems business to Cbord Group Inc. of Ithaca, N.Y., for approximately $38 million.
Diebold said Tuesday that offering college cards did not fit its focus of selling security systems to financial services companies and other customers.
"The sale of the campus card operation will allow our security business to dedicate its focus on global expansion and higher-margin services in the financial, government, retail, and commercial markets," Walden W. O'Dell, Diebold's chairman and chief executive officer, said in a press release.
Cbord, one of the top suppliers of campus card, housing, and food service management systems for the college market, works with more than 700 colleges and universities, corporations, and health care institutions.
Diebold's campus card systems control access and enable electronic payments and other services. The unit generated about $24 million of revenue last year, or just 1% of Diebold's total, according to Mike Jacobsen, a company spokesman. Diebold gets about 75% of its revenue from making ATMs.
Since last year, it has bought several security companies. Most recently, it bought Tasc Security, a privately held London company, in May for an undisclosed price.
Diebold expects to post a one-time third-quarter gain of about 18 cents a share as a result of the sale of the college card business.
Last week Diebold lowered its guidance for the second quarter and said sales to North American regional banks had fallen short of expectations. It said that it expected to report earnings between 47 and 50 cents a share for the quarter, rather than 60 to 66 cents, as it had previously predicted. The full-year guidance remains $2.60 to $2.70.
