) has chosen the inorganic route for growth and recently announced
the acquisition of Transoft International, Inc. The latter is a
cash cost optimization software company for financial institutions
Post-acquisition, NCR has plans to integrate Transoft's software
and SaaS-based product suite into its Financial Services unit. The
employees of Transoft will also be taken into NCR.
The company did not disclose the financial details of the deal.
We believe that this acquisition is a well-thought strategy, as it
can help the company to strengthen its existing cash management
Transoft has the expertise to manage cash for thousands of ATMs
across the globe. The cash optimization software uses complex
statistical analysis tools, which ultimately helps financial houses
to optimize the cash requirement of the company. NCR believes that
cash management is a $1 billion market taking into consideration
the integrated technology hardware, software and service
As cash management incurs around 30.0% of the ATM expenses, so
proper cash management results in huge savings for banks and
financial institutions. The company has identified this opportunity
and is trying to plug the gap with innovative solutions and
While the company is exploring new areas of growth, we remain
highly positive about NCR's broad-based exposure in the ATM space.
According to a study published by Retail Banking Research, NCR has
been the world's largest supplier of multi-vendor ATM middleware
and applications for 25 consecutive years.
We believe that NCR's commitment to protect the integrity of the
ATM channel and offering more benefits at a lower cost has been
inspiring banks and a host of other financial institutions to
choose its services.
However, NCR will continue to face stiff competition from
) and Wincor Nixdorf in the ATM market.
Currently, NCR Corp. has a Zacks #3 Rank, which translates into
a short-term Hold rating.
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