VeriFone Is Ripe for External Takeover

By Marc Castro

Apr 01, 2013 11:52 AM EDT

According to industry analysts, VeriFone Systems Inc is now susceptible for a takeover after its dismissal of its CEO and its share value decline in 2013. Overall, the market value of VeriFone has decreased to just US$2.2 billion and its stock value declined to 30% in 2013.

Much of main business of the company is providing in-store terminals that do the processing of credit cards and debit card payments. 

One of the key reasons for its decline is VeriFone's inability to keep up with the market and  technological changes in markets outside the United States. Another reason was the acquisition of Hypercom and Point, which has pulled down the financial performance. This was the assessment of Gil Luria, an analyst at Wedbush.

In a telephone interview, Luria said, "VeriFone has fairly stable cash flows and private equity could see value in buying VeriFone and cleaning up all the mistakes. You could fix the business and have it grow at industry rates."

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