August 3, 2015 / 9:57 AM / 2 years ago

Israel's Nice Systems sells video surveillance unit for $100 million

JERUSALEM (Reuters) - Israeli software provider Nice Systems is selling its video surveillance technologies unit to private equity firm Battery Ventures for up to $100 million, its second divestment in three months as it focuses more on its analytics business.

Nice, whose analytical software enables companies to spot fraud and fend off security threats, will receive $85 million in cash and as much as $15 million based on future performance, it said on Monday.

The sale of Nice’s Physical Security business unit is scheduled to close during the third quarter of this year and trim overall 2015 revenue by around $70 million.

Nice Chief Executive Barak Eilam told Reuters the deal completes a strategic plan started a year ago to “divest less synergetic and less profitable companies.”

In May, Nice sold its cyber and intelligence division to Israeli defense electronic firm Elbit Systems for up to $158 million.

Nice now is largely betting on its abilities to mine through big data to drive growth, as companies interact with customers in many ways, such as telephone, emails and chats.

A smaller contribution will come from a business that sells financial crime and compliance products to banks and insurance to fight fraud and money laundering.

Eilam said that while Nice is focused on organic growth, it would remain active in mergers and acquisitions.

“We are in a great cash position and have the ability to do acquisitions,” he said.

As a result of the transaction, Nice projects third-quarter revenue of $215-$225 million, down from a prior outlook of $236-$246 million while its lowered its adjusted earnings per share forecast to 65-71 cents on a diluted basis from 68-74 cents.

For all of 2015, Nice expects revenue of $914-$934 million, down from $985 million-$1.005 billion previously, and adjusted EPS of $2.97-$3.08, versus a prior estimate of $3.04-$3.15).

Nice said it expects the divestiture to be non-dilutive to earnings in 2016.

Nice’s Tel Aviv-listed shares were up 1.1 percent at midday in a flat broader market.

Reporting by Steven Scheer; editing by Susan Thomas

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