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Gemplus-Axalto merger complete

French card technology vendors Gemplus International and Axalto are taking the final steps in their merger to create a single smartcard company, Gemalto, and preparing to launch the public exchange offer for Gemplus shares.

<p>Following the expected exchange of stocks, Gemplus&#0039;s shareholders will own just over 55% of the new company, with Axalto shareholders owning the remainder. The deal has been completed on the basis of an exchange ratio of 2 Axalto shares for every 25 Gemplus shares.<br /><br />An offering circular for the offer has been filed with the French stock market authority, the Autorite des Marches Financiers, in Paris. The board of directors of Gemplus has recommended that its shareholders tender their shares to the public exchange offer.<br /><br />Axalto and Gemplus have worked together since the merger announcement in December 2005 and are ready to operate immediately under a single brand. They claim to have defined a joint customer-facing sales team and elaborated a go-to-market strategy aiming to minimize possible sales attrition.<br /><br />After further review, Axalto and Gemplus reconfirmed their initial estimate of the synergies arising from this transaction, expected to amount to $100 million per year on a fully-phased basis. <br /><br />A major priority of the board and management of Gemalto will be to achieve the successful and rapid integration of the two companies that preserves the key strengths of the culture, management and business practices of each and allows the efficient realization of the expected synergies, said Alex Mandl, Gemalto&#0039;s executive chairman.</p>