Publicard Inc. has agreed to an acquisition that would let it expand into the college smart card market.
The target, Absec Ltd., is based in Bangor, Northern Ireland. It develops cashless payment and control systems for university, military, and corporate campuses-natural early markets for smart card deployment, in the view of many in the industry.
Publicard, a Fairfield, Conn., developer that has been growing rapidly through acquisitions, said it intends to serve the education sector in Europe and the United States. The move puts Publicard in direct competition with campus smart card providers such as Cybermark of Columbus, Ohio.
"The campus market is one of the early-adopter markets for smart card technology both in the U.S. and elsewhere," said Richard Phillimore, executive vice president of smart card businesses at Publicard. "Strategically it's essential that Publicard has a campus capability within its portfolio of products."
The deal is expected to close within two months, Mr. Phillimore said.
About the overall acquisition strategy, he said, "we're looking for the short term. The whole strategy is based on providing products to marketplaces where we believe there is early adoption of smart card technology."
Acquired companies are organized as separate subsidiaries, Mr. Phillimore said, but they share technology and will eventually be phased in under the Publicard brand.
Mr. Phillimore joined the company in January from MasterCard International, where he was senior vice president of chip technology.
Absec would be Publicard's seventh subsidiary and its second foray into Europe.
Publicard recently developed a smart card-based loyalty program for smaller merchants in Europe through its subsidiary Amazing Smart Card Technologies Inc.
Called SmartReward, the program can be used by one store or a network of them. Merchants can download purchase information from cards' chips into their personal computers and thus develop a data base on customer spending patterns.
The smart cards come with an electronic purse option that can hold stored value for use at a specific retailer.
The SmartReward package includes a point of sale terminal, a cardholder data base program, card reader, and additional software. It also comes with application forms for potential customers and 500 smart cards.
The Absec acquisition will "add significant strength to Publicard's distribution in Europe and in other parts of the world while enhancing Absec's sales capabilities" in the United States, said James J. Weis, president and chief executive officer at Publicard.
Absec has supplied comprehensive smart card systems to universities worldwide, including the universities of New South Wales in Australia, of Western Cape in South Africa, and of Ulster in Northern Ireland.
Under the agreement, Publicard would distribute campus smart cards with applications such as building and network access control, as well as electronic cash for vending and laundry machines and for meals.
Colin Foster, president and chief executive officer of Absec, said the company has been building expertise in the cashless vending business since the early 1980s.
Absec "could benefit from a sales and marketing standpoint both in Europe and in the U.S. from the synergies at work within Publicard," Mr. Foster said.