Qualcomm Incorporated (Nasdaq: QCOM), a leading developer and innovator of Code Division Multiple Access (CDMA) and other advanced wireless technologies, today announced it has agreed to acquire Atlanta-based Firethorn Holdings, LLC, an industry-leading mobile banking enabler. The addition of Firethorn's expertise in the financial industry and key relationships with wireless operators, financial institutions and payment processors supports Qualcomm's broader strategy to enable end-to-end wireless services that enhance the mobile experience and to deliver compelling applications that drive increased consumer adoption of new mobile data services. Qualcomm will pay approximately $210 million in cash for Firethorn. Completion of the acquisition, which is subject to certain closing conditions, is expected within 30 days.
Firethorn's employees will remain in Atlanta supporting its existing financial institution and operator partners for mobile commerce applications. The Firethorn team will continue to be led by Firethorn's current CEO, Tripp Rackley, and will be overseen by Len Lauer, executive vice president and group president of Qualcomm. Firethorn's expertise in financial services and telecom, commercially deployed platform and early market leadership in mobile banking complement Qualcomm's expertise in enabling wireless services across networks and devices. The acquisition is intended to help financial institutions accelerate consumer adoption of mobile banking services, such as viewing account balances and history, bill pay and money transfers, while also driving the development and delivery of mobile payments and mobile marketing services.
“The acquisition of Firethorn will allow Qualcomm to help drive the evolution of mobile banking by leveraging Firethorn's industry expertise, reputation and success in developing relationships with financial institutions, wireless operators and payment processors,” Lauer said. “The combination of Firethorn's mobile banking experience and market recognition with Qualcomm's technology strength, global reach and operator relationships make this an extremely powerful development in the world of mCommerce. The acquisition solidifies Qualcomm's commitment to the emerging mCommerce marketplace and builds upon a foundation established by Qualcomm Enterprise Services, a business unit focused on providing integrated wireless systems and services to businesses around the world.”
“Qualcomm is a recognized technology leader and this acquisition is a strong endorsement of the strategic importance of mobile commerce,” said Tripp Rackley, chairman and chief executive officer of Firethorn. “The team at Firethorn will now join this industry leader as we continue to evolve mobile commerce solutions and bring new and exciting functionality to the mobile handset, including expanded payment options.”
As a result of the acquisition, Qualcomm expects approximately $0.02 dilution to pro forma earnings per share in its fiscal year ending September 2008 and a neutral impact on fiscal year 2009 earnings per share.
Founded in 2001, Firethorn is a mobile banking services enabler that links financial institutions and wireless operators through a unified, secure and scalable technology platform that seamlessly extends full-service banking capabilities to consumers from many financial institutions to many wireless devices. With Firethorn, financial institutions and wireless operators gain a competitive service differentiator that improves customer retention, generates revenue and answers consumer demands for more product/service convenience. In addition to major wireless operator partnerships, Firethorn's financial institution partners include Wachovia, SunTrust Bank, Regions Financial, BancorpSouth and Synovus, among others.
Qualcomm Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital wireless communications products and services based on CDMA and other advanced technologies. Headquartered in San Diego, Calif., Qualcomm is included in the S&P 500 Index and is a 2007 FORTUNE 500® company traded on The Nasdaq Stock Market® under the ticker symbol QCOM.
Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks, uncertainties and assumptions. If such risks or uncertainties materialize or such assumptions prove incorrect, the results of Qualcomm could differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including the expected benefits and costs of the transaction; management plans relating to the transaction; the expected timing of the completion of the transaction; the ability to complete the transaction considering the various closing conditions, including any conditions related to regulatory approvals; any statements of the plans, strategies and objectives of management for future operations, including the execution of integration plans; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the possibility that expected benefits may not materialize as expected; that the transaction may not be timely completed, if at all; that, prior to the completion of the transaction, Firethorn's business may not perform as expected due to transaction-related uncertainty or other factors; that the parties are unable to successfully implement integration strategies; and other risks that are described from time to time in Qualcomm's SEC reports, including the report on Form 10-K for the year ended September 30, 2007, and most recent Form 10-Q.