Headlines:
Prudential PLC Buying the Rest of Egg Duke and Duchess to Test BioPay Systems 305 Diebold ATMs for Philippines Bank
Prudential PLC Buying the Rest of Egg
Prudential PLC of London, Britain's second-biggest insurer, offered $365 million Thursday for the 21.7% of the online bank Egg PLC that it does not already own.
The goal is to sell more services over the Web and cut costs, Prudential said. It offered $2.04 a share, 15% more than Wednesday's closing price, and said it expects to complete the purchase in January. Each Egg share would be swapped for 0.2237 of a new Prudential shares.
Prudential would incur restructuring costs in 2006 of $86.4 million before tax. It said it expects to reduce costs by $69.1 million by the end of 2007 through improved collaboration and eliminating the expense of publicly trading Egg shares.
"We believe the company has overpaid," wrote Mark Thomas, an analyst with Keefe, Bruyette & Woods, in a note to investors. "Attempts to gain revenue synergies in the past have not been successful."
But Bob Parker, the deputy chairman of Credit Suisse Asset Management in London, said: "Over the medium term there is a high probability that the Egg platform could be successful. Should one take a bet on Internet banking in the U.K.? The answer to that is probably yes."
Prudential tried to sell Egg, Britain's largest Internet bank, last year. Its failure to do so is one reason Jonathan Bloomer left as chief executive officer in May.
Mark Tucker, the new CEO, said in October that he would expand Prudential beyond life insurance. On Thursday, in a press release announcing the offer, he said that combining the Prudential and Egg businesses and M&G Investment Management Ltd., Prudential's fund management business, would provide "significantly greater opportunities across the spectrum of personal financial services in the U.K. than is available to them operating in isolation.
Egg, one of the first online banks in Europe, had struggled to make money since 2002, when it expanded into France. Last year it sold its French savings and brokerage unit to ING Group NV and its unsecured lending business in France to Banque Accord and closed the rest of its French operations. This year it reported a third-quarter profit of $19.4 million, compared with a loss of $124.1 million a year earlier.
Duke and Duchess to Test BioPay Systems
Duke and Duchess Shoppes, a Columbus, Ohio, convenience store chain, has agreed to test biometric payment systems from BioPay LLC of Herndon, Va., in 10 of its more than 100 stores.
BioPay, owned by Englefield Oil Co. of Heath, Ohio, announced the deal Thursday. Its system enables customers to enroll at a merchant by providing a fingerprint and payment information, such as a bank account number, and to authorize payments on subsequent visits with the fingerprint. The funds are typically debited from bank accounts through automated clearing house transactions.
BioPay has 2 million registered users and more than 1,500 participating merchants.
Jason Collins, Englefield's information technology manager, said in the vendor's press release that BioPay is faster and less expensive to use than payment cards. "With BioPay payments, consumer convenience is up and retailer costs are down," he said. "BioPay costs us 70% less than processing credit or debit card transactions, and we can pass that savings along to the consumer."
BioPay announced its first patent for its technology last month. A patent-infringement against Solidus Networks Inc. of San Francisco, a biometric-payment rival, is pending.
305 Diebold ATMs for Philippines Bank
Land Bank of the Philippines, the country's No. 3 bank, has purchased 305 automated teller machines from Diebold Inc. of North Canton, Ohio.
Diebold said Thursday that Land Bank initially purchased 180 of its Opteva through-the-wall machines and later ordered another 125. The machines all use Diebold's open-standard software platform Agilis, which supports several advanced features, such as one-to-one marketing.
Land Bank will install the ATMs at branches throughout the Philippines. It has 700 ATMs, 450 of which are from Diebold.
