Leading Point of Sale Terminal Company To Buy Out Hemorrhaging Software

IVI Checkmate Corp. has agreed to buy the shares it doesn't already own of a money-losing software company.

IVI Checkmate, the third-largest supplier of point of sale terminals, already owns 82% of flagging National Transaction Network Inc., which does programming for point of sale networks. It has agreed to buy the rest for $180,000.

The deal is expected to close within three months.

National Transaction Network, which customizes and integrates point of sale networks for merchants, was trading at 28 cents a share on Thursday.

"We decided to take them private because NTN was losing money year after year," said John Neubert, chief financial officer of IVI Checkmate.

National Transaction Network lost $82,000 in the first quarter, a 44% improvement from its loss in the same quarter a year earlier. Revenues fell 35%, to $1 million.

Mr. Neubert said the company has had trouble delivering software systems on time. Its sales team has been understaffed, he added.

"They just couldn't get on their feet without a reorganization," he said.

National Transaction Network is based in Westborough, Mass. IVI Checkmate is based in Toronto.

IVI Checkmate has also struggled in 1999. In March it halted shipments of its new card readers due to a flaw in its hardware terminals' glass coating.

The problem has been corrected, but the delay contributed to a net loss of $2.3 million in the first quarter, compared with net income of $1 million in the same quarter in 1998.

Steven Shook, an analyst at Wachovia Securities in Charlotte, N.C., said the problems are minor for the company, whose clients include large merchants such as Kmart and Wal-Mart.

He rates it "neutral" and is holding off recommending the stock until the company stabilizes.

"I think they have a very competitive product line, and they have emerged as a strong player in the U.S.," he said.

IVI Checkmate's stock was trading at $3.6875 at midafternoonThursday, down 50from its Jan. 25 high of $7.375.

Hypercom Inc. and Verifone are IVI Checkmate's two major competitors in North America.

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