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Triton, Nautilus Hyosung say it's back to ATM business as usual
The collapse of Nautilus Hyosung's attempt to buy Triton won't have an immediate impact on either business, executives on both sides say.
June 10, 2009 by Tracy Kitten — Editor, AMC
When Dover Corp. and South Korea-based Nautilus Hyosung Inc. announced two weeks ago that their deal to merge Triton Systems of Delaware with Nautilus Hyosung America Inc. had fallen through, questions quickly surfaced.
Triton sources originally reported that it was the Department of Justice's inability to give the deal a quick thumb's-up that led to its collapse. But some industry insiders say Dover likely changed its mind.
It's been nearly a year since Dover, Triton's parent company, put its financially struggling ATM manufacturer on the block. Once the move was announced, many in the industry expected Nautilus Hyosung to emerge as the likely buyer.
When the two companies finally confirmed that Nautilus would, indeed, attempt to buy Triton, ATM deployers feared the merger would create a monopoly in the retail ATM space, since Triton for years had maintained a stronghold on the entry-level end of the market.
The timing was perfect for Nautilus Hyosung, given what was at the time its recent break from former U.S. distributor Tranax Technologies. Some industry insiders even speculated that Nautilus Hyosung was interested in Triton because it hoped to push Tranax out of the market, since Triton and Nautilus together would have controlled about 70 percent of the off-premises market.
But representatives from Nautilus Hyosung America say, now that the deal has fallen through, they don't expect the company to pursue any other manufacturers, adding simply that with Triton off the market, they plan to move forward with Nautilus Hyosung products and services.
"I heard Dover and NH terminated the agreement because the process was taking longer than expected," said Nautilus Hyosung America's spokesman Randal Lawrence. "We're really removed from the process."
Carlos Siewczynski of Nautilus Hyosung America says he is not aware of any plans to purchase another company, and as far as North American operations are concerned, the company will continue to focus 50 percent of its business on the retail market and 50 percent on the financial-institution market.
"We are moving forward and will continue to pursue both directions, with equal emphasis on FIs and ISOs (independent sales organizations)," Siewczynski said.
The impact on Triton
What impact the deal's collapse will have on Triton remains to be seen. The company already has laid off 58 employees as a result of the proposed acquisition's collapse. But Darryl Cornell, Triton's general manager, says he is optimistic.
"The deal with Nautilus is off, but we have been and continue to be a profitable company," said Cornell, who was brought on in August 2008 to oversee operations at Triton while the purchase was still pending. "We don't know what Dover is going to do, and it doesn't matter, because we still have plans to move forward to be a dominate player in the retail ATM space in the global market."
Dover, which purchased Triton in March 2000, owns roughly 40 companies across various industries.
"We are in ongoing discussions with Dover about Triton, but that is nothing significant, really," Cornell said. "Dover is in ongoing discussions with a number of its companies."
Over the last 12 months, Triton has undergone major restructuring and has returned to profitability. The departure of former key executives, including former company president Brian Kett, was part of that restructuring.
"The No. 1 thing is that our quality is back," Cornell said. "Over the last three or four years, we were distracted by a whole host of initiatives, and now our quality and focus are back. Our customers will tell you they don't have problems with Triton products today. And in the retail market, Triton has built a strong reputation."
Additionally, Triton will continue to make inroads in the financial market, says James Phillips, Triton's director of North American sales.
"We don't intend to let our focus on the financial-institution market wane," Phillips said. "Now, more than ever, banks and credit unions are looking for ways to expand their customer touchpoints into the off-premise market. That has always been Triton's sweet spot."
And continued competition in the market is a good thing for the industry, the company says.
Though no one at the DOJ could be reached for comment, a Justice Department spokesperson has been quoted elsewhere as saying: "The antitrust division conducted a thorough review. If the transaction had gone through, small retail establishments would have paid higher prices for retail ATMs. Competition in the market will be maintained."
Other industry insiders don't see it that way.
Bill Dunn, vice president of sales for Tranax says the collapse of the Nautilus Hyosung-Triton deal is "a shame." Dunn now oversees most U.S. operations since Tranax was acquired by South Korea-based Eltna.
"Any time jobs are lost and investment dollars from Korea are lost, it's not a good thing, for any industry," he said. "They pumped up the business in preparation for the Nautilus Hyosung deal. When that fell through, they had to lay people off."
Dunn suspects Dover backed out of deal after Triton's business returned to profitability.
"The Department of Justice held on to it, the economy crashed and Triton's value went up," he said. "It's pretty simple. Triton's got a lot of value in the market, and I think Dover decided it wanted to hold on to it."
Retail / Off-PremisesNorth AmericaPublic CompaniesAsia, Australia & PacificBank / Credit UnionHyosungTranax Technologies, Inc.Triton
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