Blackstone Group to buy Alliance Data Systems
Alliance Data Systems (ADS), parent company of the well-known marketing and customer loyalty firms Epsilon and Colloquy, has entered into a definitive agreement to be acquired by Blackstone Capital Partners V, an affiliate of The Blackstone Group, in a transaction valued at approximately US$7.8 billion.
The transaction will include the assumption of certain debts by Blackstone, along with the cash acquisition of all outstanding common stock of Alliance Data for US$81.75 per share. (The purchase price represents a premium of approximately 30% over Alliance Data's closing share price of US$62.96 on 16th May 2007.)
Stockholders asked to agree Following the unanimous recommendation of a special committee of the Alliance Data board of directors, composed solely of independent directors, the board unanimously approved the agreement and has recommended that Alliance Data stockholders adopt the agreement.
Completion of the transaction, which is currently expected to occur by year end, is subject to customary closing conditions including antitrust, regulatory approvals, and the approval of Alliance Data's stockholders, who will now be asked to vote on the transaction at a special meeting.
Will it be business as usual? Alliance Data currently manages more than 120 million consumer relationships for many major North American companies. Using transaction-rich data, the company creates and manages customised marketing solutions that aim to change consumer behaviour and enable companies to enhance customer relationships and loyalty.
On the subject of corporate changes after the acquisition, Mike Parks, Alliance Data's chairman and CEO, said that the agreement should benefit both Alliance Data stockholders and clients, and that business operations will continue as normal.
Parties involved Banc of America Securities and Lehman Brothers served as financial advisors to Alliance Data and the special committee of the Alliance Data board in connection with the transaction, and Evercore Group served as financial advisor to the special committee. Kirkland & Ellis served as legal counsel to the special committee and Akin Gump Strauss Hauer & Feld served as legal counsel to Alliance Data. Credit Suisse Securities and Blackstone Corporate Advisory Services served as financial advisors to The Blackstone Group, and Simpson Thacher & Bartlett served as its legal counsel.
Alliance Data employs over 9,000 staff at more than 60 locations worldwide, and its brands include the Air Miles coalition loyalty programme, customer loyalty and marketing firm Epsilon, and the loyalty research and publishing firm Colloquy.