French smartcard pioneer Gemalto ponied up $22 million USD to buy Keycorp’s smartcard business, including assets, intellectual property, trademarks and Keycorp’s implementation of the MULTOS smart card operating system and key management authority

Keycorp played a role in the development of MULTOS, the first open, high-security multi-application operating system for smart cards, adding it to its long string of acquisitions in the sector. MasterCard Worldwide, through Mondex, also held an ownership interest in MULTOS; Gemalto sees it as an important “bolt-on” acquisition that complements its Java product, a spokesman said in a press release. MULTOS, which has been around for 10 years, claims 50 million cardholders in 22 countries, spurred by movement to EMV.

The sale represents a strategy change for Keycorp, which will, according to its latest financial report, is to “move from a high-cost product manufacturer and vendor to a higher-margin payment solutions and service provider.”

Gemalto, meanwhile, reported a strong performance in the first half of 2008, with revenue growth of 10 percent. Gemalto divides its business into three categories: mobile, security transactions and security. Of the three, security grew the fastest, with half-year revenue increasing 16 percent over the year-earlier period. Government and identity and access management deployments comprise the bulk of the security division. 

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