FREMONT, Calif. - Identiv, Inc. (NASDAQ: NASDAQ:INVE), a global player in digital security and identification for the Internet of Things (IoT), has announced the approval of a strategic asset sale to Vitaprotech, a security solutions provider. This decision was made during Identiv's Annual Meeting on June 28, 2024, with overwhelming support from its stockholders.
Around 96% of the votes cast were in favor of the asset sale, with approximately 72% of outstanding shares participating in the vote. This high turnout indicates strong stockholder backing for the company's strategic direction, as recommended by the Board of Directors.
James Ousley, Chairman of the Board, expressed gratitude towards the stockholders for endorsing the transaction, which is expected to provide significant capital to fuel the growth of Identiv's IoT business. Plans include moving RFID production from Singapore to Thailand and investing in technology, sales, and business development to lead in RFID-enabled IoT applications.
The transaction is anticipated to close in the third quarter of 2024, subject to the satisfaction of the remaining regulatory condition from the Committee on Foreign Investment in the United States (CFIUS).
Identiv has already obtained necessary approvals under the Hart-Scott Rodino Antitrust Improvements Act and the United Kingdom National Security and Investment Act. Upon closure, Identiv will receive a cash payment of $145.0 million, with customary adjustments as per the terms of the agreement.
Identiv's business encompasses a broad spectrum of RFID and NFC technology, cybersecurity, and physical access, video, and audio security solutions. The company's forward-looking statements signal confidence in the strategic transaction's contribution to Identiv's growth and its ability to meet customer demand in the IoT space.
The detailed voting results of the Annual Meeting have been filed with the SEC on July 2, 2024. This news is based on a press release statement.
In other recent news, Identiv Inc. reported significant developments. The company's shareholders approved a major asset sale to Hawk Acquisition, Inc., a subsidiary of Vitaprotech SAS, for $145 million. This transaction involves the disposal of Identiv's physical security, access card, and identity reader segments. The company's focus is now pivoting towards the Internet of Things (IoT), targeting the healthcare, pharmaceuticals, and medical devices sectors.
Identiv's first quarter of 2024 saw revenues of $22.5 million, marking a decrease from the previous year. However, the company is optimistic about its strategic shift, including transitioning RFID production to Thailand to capitalize on lower costs. Kirsten Newquist has been appointed as CEO of the IoT division, further solidifying this new direction.
These recent developments are part of Identiv's long-term strategy for sustainable growth and profitability, despite a net loss and reduced margins. The asset divestiture is expected to close in the third quarter of 2024.
InvestingPro Insights
As Identiv, Inc. (NASDAQ: INVE) prepares for strategic changes following the approval of a significant asset sale, investors are closely monitoring the company's financial health and market position. With a market capitalization of $97.04 million, Identiv is navigating a challenging period, marked by analysts' expectations of a sales decline in the current year. The company's recent performance metrics reflect these headwinds, with a reported revenue decrease of 0.85% over the last twelve months as of Q1 2024.
Despite these challenges, Identiv holds a notable liquidity position, as highlighted by an InvestingPro Tip that points out the company's cash reserves exceed its debt. This could provide a cushion as Identiv invests in its IoT business post-asset sale. Identiv's liquid assets surpass its short-term obligations, which may offer some stability during the transition period and potential market fluctuations.
Investors considering Identiv's stock should note that it is trading near its 52-week low, as per an InvestingPro Tip, which could signal a potential entry point for those who believe in the company's long-term strategy. Moreover, with the company not paying dividends, as indicated by another InvestingPro Tip, investors' returns would be reliant on stock price appreciation, which has been under pressure as evidenced by the 50.89% drop in the three-month price total return.
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