PLEASANTON, Calif.,
Aug. 31, 2016 /PRNewswire/
-- Blackhawk Network Holdings, Inc., a leading prepaid and
payments network ("Blackhawk"),
announced today that it has entered into a definitive agreement to
acquire Grass Roots Group Holdings Ltd. (Grass Roots), a leading
provider of employee and customer engagement solutions. The closing
of the transaction is subject to completion of certain filings with
and approval by Germany's
Bundeskartellamt (Federal Cartel Office or "FCO"). Grass Roots is
headquartered in the county of Hertfordshire, United Kingdom, with offices in
Europe, the Americas and
Asia. The acquisition will broaden
the global capabilities of Blackhawk's incentives and
engagement business.
"The acquisition of Grass Roots complements the existing client
portfolio of Blackhawk's
incentives business, and enhances solutions for customers requiring
global reward and incentive platforms and products," said
Bill Tauscher, executive chairman
for Blackhawk. "We will also offer
new products and capabilities to Grass Roots' clients."
In 2014, Blackhawk launched
Blackhawk Engagement Solutions ("BES"), a leading global provider
of customized incentive and engagement solutions for consumer
promotions, employee recognition and rewards, and indirect sales
channels. BES was formed following Blackhawk's acquisitions of incentives and
rewards providers Parago, InteliSpend, CardLab and Incentec. In
addition, since June of 2015, Blackhawk has made several additional
acquisitions that have further expanded its incentives business,
including:
- Achievers, a leading provider of employee recognition and
rewards solutions designed to help companies increase employee
engagement and drive business performance. The Grass Roots offering
will complement the Achievers enterprise software-as-a-service
solution;
- Giftcards.com and OmniCard, a provider of digital and physical
prepaid gift card solutions and customized prepaid incentive and
reward solutions;
- And Extrameasures, a prepaid consumer promotions and incentives
company.
"The Grass Roots team has extensive industry experience and a
proven track record of success in the consumer and employee
engagement markets. We are thrilled to welcome them and over 2,000
managed service clients to the Blackhawk family," added Talbott Roche, CEO and president of Blackhawk.
"We are excited to be a part of Blackhawk," said Richard Bandell, CEO of Grass Roots. "Joining
Grass Roots with Blackhawk and its
industry-leading incentive solutions and prepaid product
capabilities allows us to enjoy new scale and scope advantages. We
are confident that our customers and partners will benefit greatly
from the partnership."
Grass Roots will operate as a subsidiary of Blackhawk. Matthew
Howe and Jonathan Kenny,
co-managing directors of Blackhawk's UK-based Europe operations, will lead the European
operations of Grass Roots. Stewart
Rigby, managing director, Blackhawk Asia Pacific, will lead
the Asia-Pacific operations of
Grass Roots.
About the Acquisition
Blackhawk is acquiring the Grass Roots Group
for approximately £90 million (US$118
million assuming the current pound to dollar exchange rate)
in cash, using a combination of cash-on-hand and borrowings under
an existing revolving credit facility. The transaction is subject
to approval by the FCO which is expected within the next 30 to 120
days. The acquired Grass Roots Group entities are forecasting
Adjusted EBITDA of approximately £11 million for full calendar year
2016.
The current Grass Roots shareholders comprise WPP plc and
current and former management, all of whom are selling their shares
in this transaction.
About Blackhawk Network
Blackhawk Network Holdings,
Inc. (NASDAQ: HAWK) is a leading prepaid and payments global
company, which supports the program management and distribution of
gift cards, prepaid telecom products and financial service products
in retail, digital and incentive channels. Blackhawk's digital platform supports prepaid
across a network of digital distribution partners including
retailers, financial service providers, and mobile wallets. For
more information, please visit www.blackhawknetwork.com.
About Grass Roots
Passionate about inspiring people,
the Grass Roots Group connects brands and people, through services
such as Experience and Insight, Motivation, Rewards, Benefits,
Promotions and Meetings and Events. Founded in the UK in 1980, the
Group has 12 offices throughout the world and has provided services
in over 100 countries. Grass Roots Group companies have over 20,000
total clients, including one-third of the Financial Times Stock
Exchange 100.
Forward-Looking Statements
This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act and Section 21E of the Securities Exchange Act of
1934. Forward-looking statements are indicated by words or phrases
such as "guidance," "believes," "expects," "anticipates,"
"estimates," "plans," "continuing," "ongoing," and similar words or
phrases and the negative of such words and phrases. Forward-looking
statements are based on our current plans and expectations and
involve risks and uncertainties which are, in many instances,
beyond our control, and which could cause actual results to differ
materially from those included in or contemplated or implied by the
forward-looking statements. Such risks and uncertainties include,
among other things, Blackhawk's
ability to successfully integrate the acquired business and
products; costs related to the acquisition; the competitive
environment in the industry and competitive response to the
acquisition; general market and business conditions; and the
accounting impact of the acquisition.
Other risks and uncertainties relating to the Company's business
are: our ability to grow adjusted operating revenues and adjusted
net income as anticipated, our ability to grow at historic rates or
at all, the consequences should we lose one or more of our top
distribution partners or fail to attract new distribution partners
to our network or if the financial performance of our distribution
partners' businesses decline, our reliance on our content
providers, the demand for their products and our exclusivity
arrangements with them, our reliance on relationships with card
issuing banks, the consequences to our future growth if our
distribution partners fail to actively and effectively promote our
products and services, the ability of our distribution partners to
implement EMV compliance within their expected timeline and lift
the measures they may have taken prior to such compliance to limit
or control their exposure to liability for fraud losses; changes in
consumer behavior away from our distribution partners and our
products resulting from limits or controls implemented by our
distribution partners during our distribution partners' transition
to EMV compliance; the requirement that we comply with applicable
laws and regulations, including increasingly stringent
money-laundering rules and regulations, and other risks and
uncertainties described in our reports and filings with the
Securities and Exchange Commission (the "SEC"), including the risks
and uncertainties set forth in Item 1A under the heading Risk
Factors in our Annual Report on Form 10-K for the year ended
January 2, 2016 and other subsequent
periodic reports we file with the SEC. We undertake no obligation
to update forward-looking statements to reflect developments or
information obtained after the date hereof and disclaim any
obligation to do so other than as may be required by law.
CONTACT:
Courtney Brunkow
Courtney@fletchergroupllc.com
303-717-9575
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SOURCE Blackhawk Network Holdings, Inc.