VASCO Data Security International, Inc. (Nasdaq: VDSI) (www.vasco.com) today announced that a subsidiary, DigiNotar B.V., a company organized and existing in The Netherlands (“DigiNotar”) filed a voluntary bankruptcy petition under Article 4 of the Dutch Bankruptcy Act in the Haarlem District Court, The Netherlands (the “Court”) on Monday, September 19, 2011 and was declared bankrupt by the Court today.
The Court appointed a bankruptcy trustee (the “Trustee”) and a bankruptcy judge (the “Judge”) to manage all affairs of DigiNotar as it proceeds through the bankruptcy process. The Trustee will work under the supervision of the Judge and be responsible for the administration and liquidation of DigiNotar. The Trustee is required to report to the Judge and his reports are expected to be made available to the public and will serve as a source of information to the creditors and other stakeholders. Effective as of the beginning of business today, the Trustee has taken over the management of DigiNotar’s business activities.
“Although we are saddened by this action and the circumstances that necessitated it,” said T. Kendall Hunt, VASCO’s Chairman and CEO, “we would like to remind our customers and investors that the incident at DigiNotar has no impact on VASCO’s core authentication technology. The technological infrastructures of VASCO and DigiNotar remain completely separated, meaning that there is no risk for infection of VASCO’s strong authentication business. In addition, we plan to cooperate with the Trustee and the Judge to the fullest extent reasonably practicable to bring the affairs of DigiNotar to an appropriate conclusion for its employees and customers. We also plan to cooperate with the Dutch government in its investigation of the person or persons responsible for the attack on DigiNotar. ”
“We want to emphasize that the bankruptcy filing by DigiNotar, which was primarily a certificate authority, does not involve VASCO’s core two-factor authentication business,” said Jan Valcke, VASCO’s President and COO. “While we do not plan to re-enter the certificate authority business in the near future, we expect that we will be able to integrate the PKI/identity verification technology acquired from DigiNotar into our core authentication platform. As a result, we expect to be able to offer a stronger authentication product line in the coming year to our traditional customers.”
“We are working to quantify the damages caused by the hacker’s intrusion into DigiNotar’s system and will provide an estimate of the range of losses as soon as possible, “ said Cliff Bown, VASCO’s Executive Vice President and CFO. “We expect to report the results of the DigiNotar operations, the losses related to the impairment of intangible assets specifically associated with DigiNotar and the estimated costs associated with the closure of DigiNotar either as a discontinued operation in our future financial statements or we will provide proforma information to identify the impact of DigiNotar on our consolidated results. While the losses associated with DigiNotar are expected to be significant, we do not expect, given the manner in which the acquisition of DigiNotar was structured, that the value of all of the intangible assets acquired will be fully impaired. We expect that a significant portion of the value assigned to the intellectual property acquired from DigiNotar to continue to have value as we incorporate the technology into our existing product line.”
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