Input Business Machines Inc., a Frederick-based maker of devices that "read" documents and input information from them into computers, has agreed to be acquired by BancTec Inc. for about $7.3 million in BancTec stock.
BancTec is a Dallas-based company that makes document processing systems, used primarily by banks, that also use optical scanning devices.
Shareholders of IBMI are to vote on the merger at a special meeting on June 9.
Founded in 1970, IBMI had been consistently profitable over the past several years until last year, when it lost $593,970 on sales of $4 million. The company blamed the loss on poor economic conditions at home and abroad as well as the costs of breaking a lease on a building in Rockville so that operations could be consolidated in Frederick.
IBMI's scanning systems read actual letters rather than bar codes or marks. They consist of a document transporter, a camera-like device to read the letters on a page, and a computer interface to send the information to the computer. The systems are used by banks and other institutions who need to read and process large numbers of documents for crediting accounts, billing, and other reasons.
BancTec earned $2.9 million ($1.03 a share) on sales of $25.9 million in the year ended March 31, 1982 and had lost $2.8 million on $16.4 million in revenues in the first nine months of the most recent fiscal year. BancTec officials blame the loss on business slowed by poor economic conditions.
The company's product line is similar to IBMI's but more broad; BancTec machines can also read special characters and magnetic-ink printing.
Under terms of the merger agreement, BancTec will give IBMI shareholders .22 share of its stock for each of IBMI's 1.98 million shares. BancTec stock is trading at about $16.75 a share, making the offer worth about $3.68 for each IBMI share. IBMI's stock is selling for about $3 a share. The final price will be based on the average of BancTec's price in a five-day period immediately preceding the effective date of the merger.