Douglas Bergeron was focused in the fall of 2010 like a laser on a single goal — orchestrating his company's hostile acquisition of Hypercom Corp. Bergeron had already built VeriFone Systems Inc. into a force in point of sale terminals. Its card-reading devices graced countertops of retailers in dozens of countries.

Buying its rival Hypercom, however, would add a major European presence and help Bergeron cement VeriFone's position as the premier global intermediary between consumers and the likes of Visa, MasterCard, American Express and even Google.

Yes, the buyout was attractive. But there were hurdles. They included antitrust concerns, pushback from VeriFone's investors over the risks and cost and Hypercom's own litigious streak.

Bergeron's lawyers took one look at the deal and in unison told him the same thing: fuhgeddaboutit.

Bergeron didn't listen. He spent a year in intense negotiations, turned a $280 million hostile bid into a friendly one of $485 million and, ultimately, completed the takeover.

Now VeriFone claims it could add $350 million in revenue in fiscal 2012, precisely where Bergeron wants it. "We're right at the center of all innovation, buying companies bringing out new products and new services," he says. "If we were sitting around trying to sell 1990s terminals, we'd be in deep trouble. Instead, we're at ground zero" of the payments revolution.

Since his earliest days, Bergeron has defied the odds and refused to listen when told he can't do something. He's a native of Windsor, a town in Ontario across the Detroit River from the Motor City. When he was a child his father, George, who worked at an auto parts factory, was diagnosed with multiple sclerosis, which sent him on a trajectory in his thirties from a cane, to crutches, to a wheelchair. His mother, Eleanor, worked for Avon Products while George stayed home and raised Bergeron and his siblings. She tells the story of how Doug, then around 10, pushed to the front of a crowded mall parking lot to shake hands with Pierre Trudeau, at the time Canada's prime minister. "He proceeded to say how he was going to be prime minister one day," Eleanor recalls.

The first member of his family to go to college, Bergeron, who is 51, helped pay his way to a computer science degree at Toronto's York University playing accordion at wedding receptions and bar mitzvahs. After graduating, Bergeron went to work for Northern Telecom in Ottawa and won a company scholarship to study systems management at the University of Southern California. He then took a job with SunGard Data Systems Inc., rising to become chief executive of SunGard's brokerage systems group and president of SunGard Future Systems.

In 1999 he was hired as the turnaround chief of the troubled Toronto software company Geac Computer Corp. Ltd. During his tenure, Geac, which he said focused on Y2K software, never turned around.

"What failed to occur to me in my due diligence is asking, How much software is this company going to sell in July of 2000?" Bergeron recalls. "None."

Geac eventually turned around, but without Bergeron. He was fired after 16 months.

The same day he lost his job at Geac, Bergeron got a call from the private-equity billionaire Alec Gores. By the next Monday Bergeron was in Los Angeles, working as a group president with Gores Technology Group, now the Gores Group. (The Gores Group's purchase of the U.S. business of Hypercom allowed VeriFone to buy the remainder.)

It was while working for Gores that Bergeron came upon VeriFone. Founded in the 1980s, the company grew on the back of its Zon and Tranz lines of terminals, which helped merchants convert from paper-based transactions to electronic payments.

VeriFone, of San Jose, Calif., had been publicly held for seven years until Hewlett-Packard paid almost $1.3 billion in stock for it in 1997. A culture clash ensued, and HP's ambitions to use VeriFone as a springboard to dive into the electronic payments business flopped. In 2001, the savvy Gores bought VeriFone from HP for $50 million via $5 million of equity, $35 million of debt against receivables and a $10 million seller's note from HP.

Gores put Bergeron, who was then a partner in the private-equity firm, in charge because he was the only person in the shop with experience running a technology outfit of 1,400 people.

At the time, Bergeron put down $500,000 to buy 10 percent of VeriFone. He said he immediately cut the company's head count to 800 and set off to meet VeriFone's customers.

With VeriFone again solidly profitable, the Gores Group and Bergeron sold an 85 percent stake for about $160 million in June 2002 to GTCR Golder Rauner LLC, a Chicago private-equity firm, and Bergeron himself. Bergeron reinvested some of his profits in the Gores sale into the GTCR deal, and coupled with the new carried interest he received as being CEO, he effectively maintained his 10 percent stake. Three years later, VeriFone's owners took it public. Bergeron has since cut his stake ownership to 3 percent by selling about $200 million in stock. Today his stake in VeriFone is worth about $120 million, he says.

All was going well for VeriFone until shortly after Thanksgiving 2007. That's when, Bergeron says, he got a call from his chief financial officer, Barry Zwarenstein, informing him of a serious accounting error. In early December VeriFone said it was restating its earnings for the nine months through October.

On Dec. 3, 2007, VeriFone's stock dropped 46 percent. Its market value fell by $1.8 billion in a single day.

The Securities and Exchange Commission eventually accused Paul Periolat, the supply chain controller, of massaging the financials to create bogus profits. Periolat agreed to a $25,000 SEC settlement and was fired. Zwarenstein resigned.

Bergeron faced scrutiny, too. In a deposition obtained by American Banker (see related story), SEC attorneys grilled him about email messages he sent in early 2007. The deposition indicates that Bergeron told employees "the party would be over big time for us" if VeriFone failed to meet earnings estimates.

Bergeron resigned as VeriFone's chairman but retained the chief executive title. VeriFone settled with the SEC. The episode was "a completely honest error," he insists. "We had grown fast and unlike today, in retrospect we didn't have all the checks and balances in the system."

Bergeron retains his appetite for high jinks. Earlier this year he claimed that Square Inc.'s point of sale devices contained security flaws and put customers at risk. To prove it, he had a VeriFone programmer develop an iPhone app and skim consumer information from a Square card reader. Analysts responded by accusing Bergeron of crossing the line between fierce competition and dirty tricks. "I was trying to be edgy," says an unapologetic Bergeron. "If that's viewed as prickly, I guess I'm 5 degrees off."

Outside the office, Bergeron is similarly competitive. He owns a stake in Richard Petty's Nascar team and made an unsuccessful bid to buy a piece of hockey's Nashville Predators. To celebrate a decade at VeriFone, Bergeron threw a party in October in his home in Atherton, Calif. He invited 250 guests, including his wife Sandra and five children from two marriages, turned the pool into a dance floor and hired Randy Owens of the country-rock band Alabama to perform.

Though VeriFone is entrenched with Ingenico SA as a duopoly in the payment terminal business, Bergeron retains the air of an up-and-comer. VeriFone is now focused on becoming a diversified payments company, pushing mobile payments and enabling retailers to manage online sales from branches. It installs terminals in taxis, where it accepts payments and runs ads and other content. "I fully expect that in 10 years this business will look completely different," Bergeron says. "We're certainly not sitting on a throne watching the world go by."

For more on Bergeron, see "Former VeriFone CEO Teams with GTCR to Form New Tech Company."

Sean Sposito reports for American Banker

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