L-1 is apparently close to a deal

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08/20/2010

Looking at the page view numbers, not many of you care much what happens with L-1, but Reuters is out with a story that the company will be sold shortly.

BANGALORE, Aug 19 (Reuters) - Biometric identity systems maker L-1 Identity Solutions Inc (ID.N) said it received several offers and was close to finalizing a deal, months after it put itself up for sale.

L-1 said it would announce a deal, which analysts said could be around the $1 billion mark, in the coming weeks.

I’m unclear as to why the dateline on that story is Bangalore, by the way.

Martha wrote about the company’s prospects back in March. At the time, LaPenta wouldn’t speculate on whether the company would be broken up as part of a sale, but that seems the most likely result to me.

Sure, they’ve built an interesting company with all of these acquisitions, but it doesn’t seem overly healthy to me. Here are the key statistics from Yahoo. Which part of that picture looks good to you?

The $470 million in debt, against only $645 in annual revenues? The negative profit margin?

The most recent 10Q doesn’t look all that much better.

Clearly, the economy hasn’t helped ease the combination of all of those biometric companies into one force to be reckoned with, but it’s certainly not obvious that the whole is greater than the sum of its parts, either.

Also, looking at the numbers, it’s pretty clear why none of you cares about what happens to this company. Just $11 million of its $312 million in 2010 revenues so far have been done in the commercial sector. This company sells to the feds and the states and not many others.