COLUMBUS, Ohio, Oct. 13, 2021 /PRNewswire/ -- Alliance Data
Systems Corporation (NYSE: ADS), a leading provider of data-driven
marketing, loyalty and payment solutions, today announced that its
Board of Directors has approved the separation of Alliance Data's
LoyaltyOne segment, consisting of its Canadian AIR
MILES® Reward Program and Netherlands-based BrandLoyalty businesses,
into an independent, publicly traded company, Loyalty Ventures
Inc.
The separation will be completed by a pro rata distribution
of 81% of the outstanding shares of Loyalty Ventures common stock
to Alliance Data's stockholders of record at the close of business
on October 27, 2021, the distribution
record date. Alliance Data stockholders entitled to receive
the distribution will receive a book-entry account statement or a
credit to their brokerage account reflecting their ownership of
Loyalty Ventures common stock. No action is required by Alliance
Data stockholders to receive Loyalty Ventures shares in the
distribution. Alliance Data will retain 19% of the outstanding
shares of Loyalty Ventures common stock, which Alliance Data
intends to divest after the separation in a tax-efficient
manner.
The distribution of Loyalty Ventures' shares is expected to be
completed after the market closes on November 5, 2021, with Alliance Data stockholders
receiving one share of Loyalty Ventures common stock for every two
and one-half (2.5) shares of Alliance Data common stock held at the
close of business on the record date of October 27, 2021. Fractional shares of Loyalty
Ventures common stock will not be distributed. Any fractional share
of Loyalty Ventures common stock otherwise issuable to an Alliance
Data stockholder will be sold in the open market on the
stockholder's behalf, and the stockholder will receive a cash
payment for the fractional share based on its pro rata portion of
the net cash proceeds from all sales of fractional shares.
Following the distribution of 81% of Loyalty Ventures common
stock on November 5, 2021, Loyalty
Ventures will be an independent, U.S.-based publicly traded company
and is expected to be listed on Nasdaq under the symbol "LYLT."
Prior to the distribution, Alliance Data expects to mail an
information statement to all stockholders entitled to receive the
distribution of shares of Loyalty Ventures common stock. The
information statement will describe Loyalty Ventures, including the
risks of owning Loyalty Ventures common stock, and other details
regarding the separation.
The completion of the distribution is subject to customary
conditions, including the Securities and Exchange Commission (SEC)
having declared effective Loyalty Ventures' Registration Statement
on Form 10, as amended, which Loyalty Ventures has filed with the
SEC and is available at the SEC's website at http://www.sec.gov,
and Alliance Data's receipt of an opinion from its tax advisor
confirming that the distribution qualifies as tax-free for U.S.
federal income tax purposes for Alliance Data and its stockholders
(except for cash received in lieu of fractional shares). Alliance
Data has received a private letter ruling from the Internal Revenue
Service to this effect. The Alliance Data Board reserves the
right in its discretion to delay the distribution, change any of
the terms relating to the distribution, or abandon the
distribution.
Alliance Data expects that a "when-issued" public trading market
for Loyalty Ventures' common stock will begin on or around
October 26, 2021 under the symbol
"LYLTV", and will continue through the distribution date. Alliance
Data also anticipates that "regular-way" trading of Loyalty
Ventures' common stock will begin on November 8, 2021, the first trading day following
the distribution date.
Beginning on or around October 26,
2021, and through the distribution date, it is expected that
there will be two ways to trade Alliance Data common stock – either
with or without the distribution of Loyalty Ventures common stock.
Alliance Data stockholders who sell their shares of Alliance Data
common stock in the "regular-way" market (that is, the normal
trading market under the symbol "ADS") during this time period will
be selling their right to receive shares of Loyalty Ventures common
stock in connection with the spinoff. Alternatively, Alliance Data
stockholders who sell their shares of Alliance Data common stock in
the "ex-distribution" market during the same period under the
symbol "ADS WI" will not be selling their right to receive shares
of Loyalty Ventures common stock in connection with the spinoff.
Investors are encouraged to consult with their financial advisors
regarding the specific implications of buying or selling shares of
Alliance Data common stock on or before the distribution date.
Morgan Stanley is serving as financial advisor and Davis Polk & Wardwell LLP is serving as
legal counsel to Alliance Data in connection with the
distribution.
About Alliance Data
Alliance Data® (NYSE:
ADS) is a leading provider of data-driven marketing, loyalty and
payment solutions serving large, consumer-based industries.
Alliance Data creates and deploys customized solutions that
measurably change consumer behavior while driving business growth
and profitability for some of today's most recognizable brands.
Alliance Data helps its partners create and increase customer
loyalty across multiple touch points using traditional, digital,
mobile and emerging technologies. Headquartered in Columbus, Ohio, Alliance Data is an S&P
MidCap 400 company that consists of businesses that together employ
approximately 8,000 associates at more than 45 locations
worldwide.
Alliance Data's Card Services business is a comprehensive
provider of market-leading private label, co-brand, general purpose
and business credit card programs, digital payments, including
Bread® and Comenity-branded financial services.
LoyaltyOne® owns and operates the AIR MILES®
Reward Program, Canada's most
recognized loyalty program, and Netherlands-based BrandLoyalty, a global
provider of tailor-made loyalty programs for grocers. More
information about Alliance Data can be found at
www.AllianceData.com.
Follow Alliance Data on Twitter, Facebook, LinkedIn, Instagram
and YouTube.
About Loyalty Ventures Inc.
As a standalone company,
Loyalty Ventures Inc. is a leading provider of tech-enabled,
data-driven consumer loyalty solutions. Our solutions are focused
on helping partners achieve their strategic and financial
objectives, from increased consumer basket size, shopper traffic
and frequency and digital reach to enhanced program reporting and
analytics.
We help financial services providers, retailers and other
consumer-facing businesses create and increase customer loyalty
across multiple touch points from traditional to digital to mobile
and emerging technologies. We own and operate the AIR
MILES® Reward Program, Canada's most recognized loyalty program, and
Netherlands-based BrandLoyalty, a
global provider of purpose-driven, tailor-made, campaign-based
loyalty solutions for grocers and other high-frequency
retailers.
The AIR MILES Reward Program has an active collector base,
representing approximately two-thirds of all Canadian households.
AIR MILES collectors earn AIR MILES at more than 300 leading
Canadian, global and online brands and at thousands of retail and
service locations across the country. It is the only loyalty
program of its kind to give collectors the flexibility and choice
to use AIR MILES on aspirational rewards such as merchandise,
travel, events or attractions or, instantly, in-store or online,
through AIR MILES Cash at participating Partner locations. For more
information, visit: www.airmiles.ca. To celebrate collectors
and the issuance of its 100 Billionth Mile, AIR MILES is inviting
Canadians to visit the Program
on Facebook, Instagram and Twitter.
BrandLoyalty is a leading global loyalty platform, providing
campaign-based loyalty solutions that positively impact consumer
behavior on a mass scale. We provide purpose-driven, digitally
enhanced, tailor-made solutions which improve performance - on
a transactional and emotional level - by changing consumers'
behavior.
Follow BrandLoyalty on LinkedIn and YouTube.
Caution Regarding Forward-Looking Statements
This
release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements give our expectations or forecasts of
future events and can generally be identified by the use of words
such as "believe," "expect," "anticipate," "estimate," "intend,"
"project," "plan," "likely," "may," "should" or other words or
phrases of similar import. Similarly, statements that describe our
business strategy, outlook, objectives, plans, intentions or goals
also are forward-looking statements. Examples of forward-looking
statements include, but are not limited to, statements we make
regarding initiation or completion of strategic initiatives
including the proposed spinoff of our LoyaltyOne segment that is
the subject of this release, our expected operating results, future
economic conditions including currency exchange rates, future
dividend declarations and the guidance we give with respect to our
anticipated financial performance. We believe that our expectations
are based on reasonable assumptions. Forward-looking statements,
however, are subject to a number of risks and uncertainties that
could cause actual results to differ materially from the
projections, anticipated results or other expectations expressed in
this release, and no assurances can be given that our expectations
will prove to have been correct. These risks and uncertainties
include, but are not limited to, the following:
- the spinoff may not be consummated within the anticipated time
period or at all;
- disruption to our business in connection with the proposed
spinoff and that we could lose revenue as a result of such
disruption;
- the spinoff may not be tax-free for U.S. federal income tax
purposes;
- a loss of synergies from separating the businesses that could
negatively impact the balance sheet, profit margins or earnings of
both businesses or that the companies resulting from the spinoff do
not realize all of the expected benefits of the spinoff;
- the combined value of the common stock of the two
publicly-traded companies will not be equal to or greater than the
value of our common stock had the spinoff not occurred;
- continuing impacts related to COVID-19, including government
economic stimulus, relief measures for impacted borrowers and
depositors, labor shortages, reduction in demand from clients,
supply chain disruption for our reward suppliers and disruptions in
the airline or travel industries;
- loss of, or reduction in demand for services from, significant
clients;
- increases in fraudulent activity, net charge-offs in credit
card and loan receivables or increases or volatility in the
allowance for loan loss that may result from the application of the
current expected credit loss model;
- failure to identify, complete or successfully integrate or
disaggregate business acquisitions or divestitures, or complete our
planned spinoff discussed in this release;
- continued financial responsibility with respect to a divested
business, including required equity ownership, guarantees,
indemnities or other financial obligations;
- increases in the cost of doing business, including market
interest rates;
- inability to access financial or capital markets, including
asset-backed securitization funding or deposits markets;
- loss of active AIR MILES® Reward Program collectors;
- increased redemptions by AIR MILES Reward Program
collectors;
- unfavorable fluctuations in foreign currency exchange
rates;
- limitations on consumer credit, loyalty or marketing services
from new legislative or regulatory actions related to consumer
protection and consumer privacy;
- increases in Federal Deposit Insurance Corporation,
Delaware or Utah regulatory capital requirements or other
support for our banks;
- failure to maintain exemption from regulation under the Bank
Holding Company Act;
- loss or disruption, due to cyber attack or other service
failures, of data center operations or capacity;
- loss of consumer information due to compromised physical or
cyber security; and
- those factors set forth in the Risk Factors section in our
Annual Report on Form 10-K for the most recently ended fiscal year,
which may be updated in Item 1A of, or elsewhere in, our Quarterly
Reports on Form 10-Q filed for periods subsequent to such Form
10-K, as well as those factors discussed in Loyalty Ventures'
Registration Statement on Form 10 filed with the SEC.
If one or more of these or other risks or uncertainties
materialize, or if our underlying assumptions prove to be
incorrect, actual results may vary materially from what we
projected. Further risks and uncertainties include, but are not
limited to, the impact of strategic initiatives on us or our
business if any transactions are undertaken, and whether the
anticipated benefits of such transactions can be realized.
Any forward-looking statements contained in this release speak
only as of the date made, and we undertake no obligation, other
than as required by applicable law, to update or revise any
forward-looking statements, whether as a result of new information,
subsequent events, anticipated or unanticipated circumstances or
otherwise.
Contacts:
Investor Relations: Brian
Vereb (brian.vereb@alliancedata.com), 614-528-4516
Media Relations: Shelley
Whiddon (shelley.whiddon@alliancedata.com), 214-494-3811
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SOURCE Alliance Data Systems Corporation