Blackhawk swoops on Intellispend

Source: Blackhawk Network

Blackhawk Network announced that it has entered into a definitive agreement to acquire InteliSpend Prepaid Solutions, a leader in the corporate incentives and consumer promotions marketplace.

The transaction is expected to close no later than November 8, 2013 and is subject to customary closing conditions including regulatory approvals.

"Blackhawk has become one of the largest third party providers of prepaid cards and payment solutions to consumers through its network of content providers and points of retail distribution. The acquisition of InteliSpend gives us a very strong entry into the complementary corporate incentives and consumer promotions channels," said Bill Tauscher, Blackhawk Network CEO. "Together, we will be able to bring exciting new digital solutions into the corporate incentives industry in the U.S. and internationally, adding even more value for both InteliSpend's business customers and Blackhawk's content partners," he added.

InteliSpend, with a history of innovation, is one of the largest providers of prepaid open loop incentive products, bringing deep and broad customer relationships and a strong channel partner network as the foundation for Blackhawk's future growth in this space. The company pioneered Restricted Authorized Network (RAN) technology and developed its popular DirectSpend product that enables clients to fine-tune the effectiveness of their incentives programs by controlling merchant acceptance and directing consumer spend. InteliSpend is also known for its white glove service approach, earning excellent client satisfaction ratings.

"Blackhawk brings us digital and mobile technologies, well-established content partnerships and overall industry leadership that will expand our reach," said Jim Menadier, InteliSpend president. "We share a mission to deliver world-class program management, offer unrivaled services, provide industry-leading expertise and serve the incentives and promotions industries through innovative prepaid solutions."

InteliSpend will operate as a business unit of Blackhawk, reporting directly to Talbott Roche, Blackhawk Network president, and will remain headquartered in Fenton, MO.

Blackhawk is acquiring substantially all of the assets of the InteliSpend business for cash and plans to finance the purchase using cash on hand and borrowings from Safeway Inc., Blackhawk's parent company. The acquisition is not expected to have a material impact on Blackhawk's fourth quarter 2013 results. For fiscal 2014, it is expected to add approximately $50 to $60 million in Adjusted Operating Revenues and be earnings accretive. Closing conditions include expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Raymond James & Associates served as financial advisor to InteliSpend and its parent company, Maritz Holdings, Inc.

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