November 23, 2017 / 11:46 AM / 2 years ago

Sweden's Fingerprint Cards plays down takeover approach

STOCKHOLM (Reuters) - Sweden’s Fingerprint Cards (FPC) (FINGb.ST), whose ID technology is used in smartphones, said on Thursday it had been approached about a possible bid for the company, but added that it viewed the chances of a deal as low.

It issued its statement after Swedish newspaper Dagens Industri reported that China’s Beijing Watertek (300324.SZ) was preparing to bid for the company.

Shares in the Swedish company jumped as much as 37 percent in early trade on Thursday after the report, but fell back after FPC’s comment to trade 9 percent higher at 18.43 crowns by 1054 GMT.

The company makes fingerprint sensors for smartphones for customers including top Chinese smartphone makers - Huawei, Xiaomi, Lenovo and Oppo – and Google Pixel, among others.

Fingerprint said a bid was unlikely to materialize but it had been required under stock exchange rules to make a statement to protect against insider trading.

“Since the overall assessment is that the probability for the offer plans being realized is low, the company does not consider that the information constitutes insider information.” Fingerprint said in its statement. It did not elaborate on why it viewed an offer as unlikely and a company spokesman could not immediately be reached for comment.

Dagens Industri’s report said a letter from Beijing Watertek had been delivered to FPC Chairman Jan Wareby and CEO Christian Fredrikson this week, citing a source close to the Chinese company.

An investor relations officer at Beijing Watertek said she was not aware of any bid for Fingerprint Cards.

FPC does not supply the world’s biggest smartphone makers Apple (AAPL.O) and Samsung Electronics (005930.KS).

The company saw a spectacular stock price rally in 2015 but its shares have since tumbled as competition has increased. The market expects the company to move beyond fingerprint technology to other forms of user authentication such as Apple’s FaceID.

FPC’s share price had fallen more than 70 percent this year by Wednesday to levels last seen in 2015.

Reporting by Helena Soderpalm, Olof Swahnberg and Johannes Hellstrom; Editing by Niklas Pollard/Tom Pfeiffer/Susan Fenton

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