After a long wait, and intense U.S. govermental scrutiny, Smartmatic Corporation announced that it will put Sequoia Voting Systems up for sale. This should effectively end the examination of Sequoia’s ownership structure (examination that had been going on for some time by the U.S. Committee on Foreign Investment in the United States).
Here are a few details from the Chicago Tribune:
The companies also said they will withdraw from a review process now under way by the Committee on Foreign Investment in the United States, a panel of 12 government agencies that earlier this year reviewed an attempt by a United Arab Emirates company to take over operations at six U.S. ports.
Sequoia and Smartmatic, which are privately held, had come under review several months ago because of questions about alleged ties to the leftist government of Venezuelan President Hugo Chavez. The inquiry, which will now be dropped, was to determine whether the Venezuelan government has any control or influence over the firm’s operations.
Company officials said the controversy over foreign ownership was distracting for both Sequoia and Smartmatic, and was “taking a lot of time from senior management.”
For those of you with a wad of cash, and someone special still on your holiday shopping list, this could make for a thoughtful present.
On the serious side, it’s hard to see at this point what effect this will have on the voting system industry. This investigation, while clearly a difficult one for Sequoia, might lead to more openness and transparency for Sequoia, once it is acquired by some new entity. I’d hope that this will also serve as a signal to the industry that being open and transparent about their corporate operations is a critical issue as we continue the long process of election reform in the United States. Perhaps voting system companies will step forward now, developing and implementing strong corporate ethics policies — or perhaps the industry can get together and develop some ethics guidelines that will help them navigate increased scrutiny and calls for more transparency.
- The full Smartmatic press release.
- From the Miami Herald. The Miami Herald also has a pdf file of the Smartmatic announcement here.
- Story from Forbes, focusing on the Committee on Foreign Investment in the United States.
- Ian Hoffman (who has followed voting technology issues for the Oakland Tribune) and Barbara Grady, “Potential Buyers Can Cast Lot With Sequoia. This article has interesting information for all of you would-be buyers — estimating that Sequoia has about 150 employees, and the following information on revenues: “Under its last owner, De La Rue PLC, Sequoia was losing money on revenue of about 23.1 million British pounds, or about $50 million. Those revenues were down by almost half the previous year’s when, according to De La Rue, the Sequoia division brought in 44.2 million pounds, about $86 million. But the operating loss was much larger in 2003-04, at 1.9 million pounds, or nearly $4 million. Smartmatic executives said they turned the company around and quadrupled revenues to more than $200 million, with an undisclosed amount of profit.”