The years were 2003 – 2007

• Pakistani authorities capture the alleged mastermind behind the Sept. 11 terrorist attack in the United States
• North Korea announces it possesses nuclear weapons
• Switchover to digital television signals begins in Europe

Meanwhile . . .

Twenty-seven new companies joined Diebold between 2003 and 2007. It was one of the most active periods ever for acquisitions.

The purchases were designed to bolster Diebold’s security, self-service and professional services businesses, aid Diebold’s plans for global growth, add new skills to the company portfolio, provide new market opportunities and fill special market niches.

Among the firms we acquired during that time were:

• An information technology provider based in Bountiful, Utah.
• A high-end security systems integrator from White Plains, N.Y.
• An alarm-monitoring company in Monterrey, Mexico.
• A sophisticated payment processing firm based in Miami, Fla.
• An ATM regional service organization in Minneapolis, Minn.
• Three security companies in Australia.

Diebold’s acquisitions have followed a specific strategy, based on each business unit’s development plan.

• In security, four major acquisition themes are at play. Overall, we’re focused on global expansion. We’re also pushing hard to build our skills, knowledge and capabilities in the government sector. We see opportunities in higher-end, more complex security technology integration. In addition, we’re planning for growth in our new fire detection and monitoring business.
• In service, we have looked to grow – or, in some cases, establish – our organization in parts of the United States and in targeted countries where we have had minimal, or no operations, for example, Peru and Malaysia.
• In software and professional services, the thrust is to find companies that add to, or strengthen, our existing business by adding their own unique skill sets to our offerings. Examples include companies with specialized technical expertise, or those that perform today’s critically important new functions, such as payment processing. “Buy, invest, build and grow” are the cornerstones of security’s acquisitions strategy as the business continues to expand its expertise and gain new capabilities to serve customers in the commercial, financial, government and retail markets.
• In the commercial market, enterprise-level clients require a global approach to system design and implementation. Now, Diebold can deliver on this requirement and provide uniformity and consistency across the customers’ enterprise for every project.
• Financial customers represent Diebold’s largest core security market. Diebold can install and integrate our financial security products into customers’ existing systems and provide the necessary service to keep the systems running at peak efficiency. Products that financial customers typically purchase include access control and enterprise security systems, alarms and security monitoring, depositories, vault and safe products, drive-up facilities and more.
• Within the government market, the focus is on building skills and capabilities, especially in credential management. Within the United States, we recently earned specific General Services Administration (GSA) contracts and certifications that are opening doors to significant new government business, including electronic and physical security products, as well as solutions that meet stringent requirements for homeland security.
• In the retail sector, our security business is rapidly expanding. During the first half of 2006, we installed security systems in more than 700 retail sites per month. These efforts also include providing customers with network-based security systems that require expertise with Internet protocols as well as alarm/video monitoring, workflow improvement and loss prevention solutions.
  

Diebold’s security acquisitions have helped us gain name recognition in a crowded and competitive marketplace.

Similarly, service acquisitions have been for very specific reasons, not simply just to grow. Acquisitions must meet one or more of the following criteria:

• ‘In-line’ acquisitions. To grow within our current markets, we may acquire competitors to reduce costs as much as we can and improve customer service levels. These kinds of acquisitions typically bring valuable, skilled associates and new customers on board quickly.
• Complementary acquisitions. To expand our geographical footprint and gain technological expertise, we look for companies in related businesses. We’re particularly interested in growing our managed services business.
• New technology acquisitions. We are also very interested in acquisitions that fill a gap for us in some way, or bring us a new skill set. Our acquisition of Brixlogic is a good example. This is a software company that has been instrumental in providing technology for our software platforms.

Diebold continues to keep a sharp eye focused on the next beneficial acquisition that will further add to its strengths as a multi-talented firm with a global reach. Some of our most important acquisitions Commonly accepted within the company are a number of notable acquisitions which brought to us new products, great market penetration or valuable new skills. Among the most often-mentioned are these:

1947: The O.B. McClintock Company. Highly regarded for its service department and contracts, police and burglar alarm systems, drive-up window banking technology and After Hour® depositories, all of which complemented Diebold’s organization nicely.

1946: Yale Safe and Lock Company. Our company’s closest rival of the day. Considered by contemporary observers as the most spectacular acquisition Diebold had made. Engineered by then-Chairman Eliot Ness, with help from rich Texas oil man Clint Murchison Sr., who personally guaranteed loans needed to make the purchase. Yale was the largest pre-World War II producer of safes and vaults and had a strong sales base on the east coast. But its sales division deteriorated during the war. We acquired all of Yale’s patents, tools, service contracts, orders and sales branches. The acquisition allowed us to expand our market share, geographic reach and product lines.

1955: K. F. Kline Company. Makers of steel lockers, shelving parts, storage bins, and storage and wardrobe cabinets. This acquisition, when combined with our previous business in record-handling and storage equipment, accounted for almost 50 percent of our total sales volume in 1957. 1958-59: Herring-Hall-Marvin Safe Company. This buy launched us into the teller counter equipment field. Bank customers were offered a broad range of equipment using modular construction that permitted flexible installation patterns without the need for custom designs.

1965: Lamson Corporation. A specialist in horizontal and vertical material moving, including pneumatic tube systems and their varying applications, particularly computer-regulated tube transport systems. Permitted us to use Lamson technology in our drive-up remote teller stations. The technology also allowed us to enter new markets, such as vertical material handling among floors of large office buildings.

1999: Procomp. The company manufactures and markets a wide variety of innovative technological solutions, including personal computers, servers, software, professional services, and retail and banking automation equipment. Its diversity of product and scope allowed us to expand into new directions and offer a more comprehensive global product line.

2000: Groupe Bull and Getronics ATM businesses acquisitions involving 32 countries, which put Diebold solidly on the map internationally.