383 — NICE Systems To Acquire Thales Contact Solutions For Stock and Cash Valued at Approximately $55 Million

Jul 31, 2002 | Conteúdos Em Ingles

NICE Systems and Thales Group announced they have signed a definitive agreement providing for NICE, to acquire the assets of Thales Contact Solutions (TCS).NICE Systems

NICE Systems (Nasdaq: NICE) and Thales Group (Paris Bourse: TCFP) jointly in 31 July announced they have signed a definitive agreement providing for NICE, a worldwide leader in multimedia recording solutions, applications and related professional services, to acquire the assets of Thales Contact Solutions (TCS), a leading developer of customer-facing technology for Public Safety, Wholesale Trading and Call Centers. Headquartered in Southampton, England, TCS is a unit of the Information Technology and Services business area within the $10.3 billion (10.3 billion euros) Thales Group, one of Europe’s premier electronics companies.

‘As other companies in our industry wait for IT spending to improve, we prefer to capture the first-mover advantage and start making things happen,’ said Haim Shani, chief executive officer of NICE Systems. ‘TCS is an excellent strategic fit with complementary attributes in technology, products, domain expertise, management, geographic focus, and channel partners. Since there is very little overlap between the two companies’ operations, the integration challenges will be quite manageable and we expect this combination to quickly generate significant benefits for customers, partners shareholders, and employees”.

The transaction, which has been approved by the boards of both NICE and Thales Group, is expected to close in the fourth quarter of 2002, subject to regulatory approvals and customary closing conditions. Upon closing, Mr. John Hughes, executive vice president and COO of Thales IT&S and Mr. Tim Robinson, senior vice president of the Secure Operations business group of Thales, will join NICE’s board of directors, expanding the number of directors to ten.

Commenting on the announcement, Hughes said, ‘This transaction enables us to increase our focus on our core operations while continuing to participate in the potential of the business through our equity position in NICE shares. We are excited about this acquisition as it capitalizes on the strengths of both companies and creates a clear leader in the marketplace.’

The acquisition of TCS complements both of NICE’s core businesses and creates the preeminent global multimedia recording and enhanced applications company. NICE will add TCS’s operations serving contact centers and trading floors to its CEM (Customer Experience Management) division. Based on trailing 12 month pro forma figures, this division would be a $154 million annual revenue business and, with the addition of TCS’s public safety business, NICE’s Security Group would become a $63 million annual revenue business. (These figures were calculated using US GAAP for NICE and international accounting standards for TCS.) The transaction is expected to be accretive to NICE’s per share earnings for 2003.


TCS has a total of 275 employees, 208 in Europe, 60 in North America, and 7 in other regions. The combined company initially will have 326 people in North America, 232 in Europe, 528 in Israel, and 19 in other offices around the world. Mr. Jim Park, managing director of TCS, will head NICE’s CEM division, which will benefit from his strong background in contact centers. Since joining TCS in 1998 from Mitel Corporation, Mr. Park has led a successful restructuring effort and under his leadership the company became a leader on the global contact center arena. NICE recently consolidated its closed circuit television security, air traffic control, and government intelligence businesses into a single organization, the Security Group, headed by Doron Eidelman, an experienced operating executive recruited by NICE from Audiocodes in May.

‘Jim will be a real asset to our senior management team and I look forward to working with him,’ said Shani. ‘Also, the representatives of Thales will add an important new dimension to NICE’s leadership, and we will be pleased to welcome John and Tim to our board of directors.’

Creating Value

TCS brings the following benefits to NICE’s CEM division (contact centers/financial trading floors):

   · Complementary domain expertise
   · Excellent solution for mid-size contact centers, creating most extensive product line in the industry
   · Extensive distribution network in Europe
   · Large worldwide customer base, with particular strength in Europe
   · Existing service infrastructure in Europe
   · Opportunity to capitalize on NICE’s professional services organization
   · Compatible product roadmap
   · Ability to accelerate product development and shorten time-to-market

The transaction also benefits the NICE Security Group in several ways:

  · Complementary domain expertise 
  · Adds a new market segment in Public Safety with excellent products and substantial and growing market share
  · Complementary geographic presence
  · Excellent channel partners

‘Together these two organizations will create a global company in every sense of the word – with unparalleled depth of experience in each business segment in all geographies, the most extensive product line in the market, and the strongest professional services organization. Looking toward the future, we will have the strongest R&D team and the most flexible platform for creating valued added applications, with the most extensive network of worldwide channel partners to bring them to market,’ said Mr. Park.

Transaction Terms

The purchase price is comprised of $30 million in cash at closing plus 2,187,500 ordinary shares of NICE Systems. Based on the closing price of NICE shares on the Nasdaq Stock Market on July 30, 2002, the value of the transaction is approximately $55 million. The agreement also provides for additional contingent cash payments of up to $10 million in 2003, $7.5 million in 2004, and $7.5 million in 2005 if certain financial performance criteria are met as part of a three-year earn-out provision covering 2002 through 2004.

Webcast/Teleconference Information

NICE will host a conference call for the investment community in 31 July at 9:00 a.m. EDT(14:00 London; 16:00 Israel) to discuss the transaction and second quarter results. The call will be broadcast live on the internet via NICE’s website at www.nice.com. The slides used for this presentation will be available on NICE’s website at the time of the call. An archived version of the discussion will be available shortly after the conclusion of the live webcast on the NICE website and will remain available for 30 days. A telephone replay will be available for up to 72 hours after the call. The replay information will also be available


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