Blackhawk Snaps Up InteliSpend (Oct. 22, 2013)
Blackhawk Network late Monday announced it plans to acquire InteliSpend Prepaid Solutions, a leader in corporate incentive cards and promotions, in an all-cash deal expected to close no later than next month. Blackhawk sought InteliSpend, a 2013 Paybefore Award winner, because of the “great synergies” that exist between Blackhawk’s own retail gift card partners and InteliSpend’s restricted authorized network (RAN) capabilities and specific corporate gift card programs, Bill Tauscher, Blackhawk’s CEO, told analysts in a conference call today.
InteliSpend, a unit of Maritz that accounts for about 5 percent of its parent company’s revenues, has 180 employees and will remain headquartered in Fenton, Mo., and operate as a unit of Pleasanton, Calif.-based Blackhawk, according to Blackhawk executives. Exact terms of the deal were not disclosed
but Blackhawk executives suggested the price will settle between $71 million and $100 million.
Blackhawk went after InteliSpend because of its deep corporate and merchant relationships and patented gift card delivery programs, Tauscher told analysts. As the incentive card industry shifts from merchandise and travel to delivering open-loop prepaid cards as rewards for employees and sales forces, there are major growth opportunities ahead, he said.
“This acquisition opens up lots of opportunity for the next phase of prepaid evolution to digital and mobile, plus the expansion in B2B loyalty and incentives,” John Grund, a partner at First Annapolis Consulting, tells Paybefore.
The combination of Blackhawk and InteliSpend also signals growth opportunities abroad, Philip J. Philliou, a principal with Philliou Partners LLC, tells Paybefore. “Blackhawk has a disciplined management team that knows how to execute against large and complicated opportunities,” he adds.
InteliSpend won Paybefore kudos this year for its Expense Visa Prepaid Card, harnessing a RAN for paying corporate expenses, enabling companies to restrict spending to a selected group of merchants or merchant category while tracking spending, with the option to reload cards and add ATM access. In July InteliSpend announced the launch of 5% Back, a feature developed to give Visa prepaid cardholders 5 percent of their transaction amount back when they use their cards at preferred U.S. merchant locations.