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Mitek Systems Inc. announced Wednesday that it acquired Paris-based Artificial Intelligence and Image Analysis (A2iA), a developer of text-recognition and imaging software, for €42.5 million ($49.8 million) in cash and stock. The move bolsters San Diego-based Mitek’s already strong position in the remote deposit capture market and gives it access to other emerging technologies.
Mitek chairman and chief executive James B. DeBello said on a conference call Wednesday afternoon that A2iA brings to Mitek handwriting-recognition and other identification technology, as well as software that works in various Asian and Arabic-related languages, which will help Mitek penetrate new global markets.
“This acquisition also solidifies Mitek’s leadership in mobile deposit, and makes Mitek the global standard of check imaging across all channels, including mobile, RDC, ATM, and branch,” DeBello said.
A2iA uses artificial intelligence and machine learning to create algorithms that process checks, identity documents, and other documents for banks, retailers, insurance companies, mobile operators, health-care providers, and governments in more than 42 countries and 11 languages, Mitek said in a news release. Some 100% of banks in the United Kingdom, 90% of the banks in France and Brazil, and 75,000 ATMs worldwide use its applications.
More than 6,100 financial institutions license Mitek’s flagship Mobile Deposit product, including all of the top 10 U.S. banks. Offered through bank mobile apps, Mobile Deposit which enables customers to upload checks to their accounts by snapping pictures of them on their smart phones.
But one thing A2iA had that Mitek didn’t until now is imaging software that recognizes the courtesy amount and legal amount written on checks. The legal amount is the value written in cursive, while the courtesy amount is the numeric value the check writer fills in on the right-hand part of the check. Mitek’s Mobile Deposit has used licensed technology from an unidentified competitor to read those so-called CAR/LAR amounts.
“This gives us that ability to remove that [competitor’s product], use this, and we’ll save on those costs,” Mitek chief financial officer Jeff Davison said on the call. In fact, Mitek announced Wednesday that it has already integrated A2iA’s CheckReader product, the company’s biggest revenue generator, into version 4.7 of Mobile Deposit.
A2iA had revenue of €12.9 million ($15.1 million at current exchange rates) and €1.7 million ($1.99 million) of operating income in 2017, Mitek said. The €42.5 million purchase price consists of €24.4 million in cash and 2.5 million Mitek common shares valued at €18.1 million.
Mitek said A2iA’s management team will remain in place. “The combination of our company’s industry-leading technologies with Mitek’s resources as a publicly-traded U.S. company will provide our partners in Europe, the Americas and across the globe with unparalleled capabilities,” Jean-Louis Fages, A2iA’s president and chairman, said in the release.
