Alliance Data’s Epsilon to Acquire Equifax’s Direct Marketing Services Division

DALLAS, TX - Alliance Data Systems Corporation (NYSE: ADS), a leading provider of loyalty and marketing solutions derived from transaction-rich data, today announced that it has reached a definitive agreement to acquire the Direct Marketing Services (DMS) division of Equifax, Inc. Equifax’s DMS division provides proprietary data-driven, integrated marketing solutions through two complementary offerings: database marketing and hosting, and data services including U.S. consumer demographic information. Purchase price is $117 million, with no impact to earnings for the remainder of 2010, but accretive thereafter. The transaction is expected to close in the third quarter, pending customary regulatory approvals and closing conditions. Equifax’s DMS division has approximately 200 full-time employees and will be integrated into the Company’s Epsilon business under its Epsilon Targeting and Marketing Technology groups upon closing.

The transaction fits squarely within Alliance Data’s strategy of seeking strategic acquisitions that enhance core capabilities and strengthen its competitive advantage. Specifically, benefits Alliance Data and Epsilon expect to realize from this acquisition include:

* New data sets, and verticals including telecommunications and financial services;
* Additional scale in database development and hosting;
* Additional clients including several Fortune 1000 companies;
* Additional analytics and delivery optimization expertise; and
* Experienced management to further strengthen Epsilon’s operational and solutions delivery excellence.


Bryan Kennedy, Epsilon’s president, said, “We’re excited about the business synergies and strategic fit that this acquisition represents for our business. Equifax’s DMS brings in to the fold several appealing aspects that will further Epsilon’s position as a leader in providing data-driven, highly targeted marketing solutions across an evolving multi-channel landscape. Today’s announcement is further evidence of our ongoing commitment to not just maintain, but enhance Epsilon’s leadership position in delivering effective solutions that help our clients grow their businesses. We look forward to welcoming our new associates, continuing to deliver best-in-class services to the DMS clients, and further enhancing our offering that will benefit all our clients.”

Ed Heffernan, president and chief executive officer of Alliance Data, said, “We are, first and foremost, a growth company. This transaction is typical of Alliance Data’s long-term strategy of supplementing very strong organic growth with a small number of tuck-in acquisitions. Across Alliance Data’s three businesses, we continue to build and strengthen the five key aspects of our model: creative, data, database, analytics and digital distribution. These are the key areas deemed critical to succeed in the market’s significant and ongoing shift from mass marketing toward transactional-based, data rich, ROI-based marketing. This tuck-in acquisition will be additive to Epsilon’s data and database businesses and will bring with it a solid management team.”