Diebold offered to buy number two Wincor for 1.7 billion euros ($1.9 billion) on Saturday with details to be hammered out over the next few weeks.
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It was reported today that ATM maker Diebold Inc is offering to take over Wincor Nixdorf of Germany in a deal that would value the German company at more than $1.7 billion and is being seen as a huge positive by analysts and investors on the street.
Such a business combination would be implemented through a public tender offer for all issued shares of Wincor Nixdorf. Diebold has said that it expects cash usage to continue to grow 3 percent a year through 2020.
The rise of online banking and e-commerce poses a challenge to the likes of Wincor, which have been struggling with low capital investment by banks eager to keep costs in check while still battling the lingering effects of the financial crisis.
The company has allocated €80 million to a restructuring programme this year that aims to boost its software business while drastically reducing its reliance on hardware sales.
Wincor seems to be following a similar strategy, with announcements that it would rely less on ATM manufacturing and sales and make a renewed attack on software and IT services, which, WSJ noted, now encompasses 59 percent of its top line.
US-based Diebold is the second-largest company in the ATM market and has entered into an agreement with rival Wincor Nixdorf, which occupies the spot below it in third.
Wincor is the third-largest maker of ATMs behind leader NCR Corp (NCR.N) and Diebold, which, with a market capitalisation of $2.2 billion, has roughly the same market share as Wincor.
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Under the terms of the agreed deal, Diebold is offering to pay 52.50 per share in cash and stock, a 35-per cent premium to Wincor Nixdorf ” s Friday closing price.
