Here’s Apple’s POWERFUL New Purchase

On Friday, Apple (NASDAQ:AAPL) announced it will buy fingerprint sensor technology developer AuthenTec (NASDAQ:AUTH) for about $356 million in a deal that is set to bolster the iPhone maker’s security capabilities and patent portfolio.

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AuthenTec’s customers include Cisco (NASDAQ:CSCO), Hewlett-Packard (NYSE:HPQ), Lenovo, Nokia (NYSE:NOK) and Motorola Mobility. It also recently started providing mobile security software licenses to Apple rival Samsung. AuthenTec also provides its fingerprint systems for authentication of mobile payments in Japan, a technology that Apple can potentially bring to the U.S. market. While companies like Google (NASDAQ:GOOG) offer mobile payment systems at the moment, the service is not widely used for its unaddressed security concerns.

“If you’re storing credit card information in your phone for mobile payments, it would be more secure if it has fingerprint authentication rather than just a password protection,” BWS Financial analyst Khorsand Hamed told Reuters.

As part of the deal, Apple is paying AuthenTec $20 million to acquire its non-exclusive licenses and other rights for hardware technology and software technology as well as its patent portfolio. Apple has also asked for the right to pay another $115 million to license the technology forever and nonexclusively.

AuthenTec, which was spun off from Harris Semiconductor (NASDAQ:ISIL) in 1998, has annual revenue of about $70 million. Apple is paying $8 per share, a 58-percent premium, for the deal to AuthenTec, whose stock rose 63 percent to $8.25 on Friday morning. The agreement only represents 0.3 percent of Apple’s cash holdings. The acquisition is Apple’s second biggest, after the $400 million purchase of Anobit Technologies last year.

Apple (NASDAQ:AAPL) closed Friday up 1.79% at $585.16 per share, while AuthenTec (NASDAQ:AUTH) finished Friday up 66% at $8.42 per share.

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