AuthenTec (AUTH)

[Art Vandeley]

Apple to Buy AuthenTec for $350 Million

Apple Inc. (AAPL) has agreed to buy fingerprint authentication sensor maker AuthenTec Inc. (AUTH) for about $350 million as the consumer-electronics giant puts a chunk of its massive cash holdings to work.

Pricewise, the deal is one of Apple's bigger. Known for being secretive, Apple didn't immediately disclose its intentions for the technology. Even AuthenTec said in its filing with the Securities and Exchange Commission that it "cannot comment on Apple's intentions" for the company.

AuthenTec holders will receive $8 a share in cash, a 58% premium over Thursday's close. Shares, which have climbed almost 60% this year, last traded above the offer price in summer 2008 and later slid to under $2 a share during the financial crisis amid worries about biometrics demand. In premarket trading, they surged to $8.04, topping the bid price.

Apple will pay AuthenTec $20 million to acquire non-exclusive licenses and certain other rights with respect to hardware technology, software technology and patents of the company.

The deal, which is subject to a go-shop provision, carries a nearly $11 million termination fee.

At June 30, Apple listed $117.2 billion in cash and cash equivalents and short-term and long-term marketable securities. It declared a quarterly dividend and massive share buyback plan earlier this year, heeding investor calls.

Earlier this week,Apple said its fiscal third-quarter earnings climbed 21% as the consumer electronics giant continued to see stronger iPhone and iPad sales, though overall earnings and revenue grew less than analysts had expected.

In May, AuthenTec said its first-quarter loss had widened as the company saw its revenue fall.

Write to Saabira Chaudhuri at [e-mail]

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