American Express to Expand International Customer Base with Acquisition of Loyalty Partner

Deal creates leading global rewards and loyalty business

New York, NY, Munich – American Express Company today announced it will acquire Loyalty Partner, a leading marketing services company best known for the loyalty program it operates in Germany, Poland and India. Loyalty Partner also provides market analysis, operating platforms and consulting services that help merchants grow their businesses.

The acquisition will deepen American Express’ merchant relationships in select international markets, add more than 34 million consumers to the company’s international customer base and expand its range of rewards and loyalty marketing services.

The acquisition is part of American Express’ drive to build and diversify its fee service revenues and expand its international presence. Joining American Express will help Loyalty Partner accelerate its entry into new international markets.

Through Loyalty Partner’s coalition program, loyalty cards are distributed to millions of cardholders who can earn points and enjoy discounts and exclusive benefits at thousands of merchant partner locations. Merchants fund the consumer offers and Loyalty Partner earns revenue from operating the platform and providing marketing support though its network of relationship managers.

 “The loyalty coalition model is growing rapidly in many parts of the world,” said Ed Gilligan, American Express Vice Chairman.  “Increasingly, consumer decisions about where to shop and how to pay are based on loyalty offerings, and Loyalty Partner is a premier player in this space.”

“We recognize that network scale, technology, marketing expertise and customer loyalty are keys to a new generation of mobile and location-based digital marketing services. With its state-of-the-art platform, rewards that serve as a virtual currency, outstanding management team, and large customer and partner base, we think Loyalty Partner will be an excellent complement to our existing businesses.”

"Loyalty Partner has a ten year history of success and continuous, impressive growth," said Alexander Rittweger, Loyalty Partner Founder and Chief Executive Officer. "Joining with American Express helps us to accelerate further our expansion into new, international markets and will allow us to drive even greater value to consumers and help our coalition partners grow their businesses.”

Loyalty Partner will become a subsidiary of American Express and will be part of the company’s International Consumer and Small Business Services group, led by its President, Douglas Buckminster. Alexander Rittweger will continue as Chief Executive Officer of Loyalty Partner.

The purchase, which is subject to regulatory approval, is expected to close in the first quarter of 2011. The transaction, which values the company at €496 (US $660) million, consists of an upfront cash purchase price of €425 (US $566) million and an additional €71 (US $94) million equity interest that will be held by Loyalty Partner’s management.  American Express will acquire that interest over the next five years at a value based on business performance. 

UBS Investment Bank acted as sole financial advisor and Cleary, Gottlieb, Steen & Hamilton LLP acted as legal advisor to American Express.

About American Express
American Express is a global services company, providing customers with access to products, insights and experiences that enrich lives and build business success.  Learn more at www.americanexpress.com and connect with us on www.facebook.com/americanexpress, www.twitter.com/americanexpress and www.youtube.com/americanexpress.


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