Loyalty group Grass Roots snapped up in £90m deal

o2-march-of-the-ducks-1Grass Roots Group, the loyalty specialist run by former Claritas chief Richard Bandell, has been bought for £90m by US incentives company Blackhawk Network, in a deal which it is claimed will allow both companies to broaden their international reach.
Founded in 1980, and a former WPP affliliate, Grass Roots operates in 15 countries. It claims to work for 20,000 companies, including a third of all FTSE 100 companies, with the likes of Asda, BMW and O2 among its clients.
The firm’s offering includes customer experience and insight, multichannel communications, data analysis, staff motivation, sales incentives, rewards, benefits, digital and offline promotions, as well as meetings and events.
Grass Roots’ activity includes the O2 Top Up Surprises campaign (pictured), and the ‘Love Cravendale’ promotion, while the rewards scheme it runs for Vodafone has over 2.5 million participants. It has also worked on the McDonald’s Monopoly campaign.
California-based Blackhawk was launched in 2006 and specialises in prepaid and payment cards. The deal is the group’s second this year; in January it bought GiftCards.com – which sells digital and physical prepaid gift card solutions to consumers – for $120m. Blackhawk’s client list includes Facebook, eBay, Tesco, Apple iTunes and Visa.
The Grass Roots Group acquisition is expected to be an opportunity for Blackhawk to extend its global footprint by offering global reward and incentive products to its clients through Grass Roots’ employee and customer engagement solutions.
Grass Roots chief executive Bandell said: “Joining Blackhawk opens up significant growth opportunities for Grass Roots, transforming us into a leading global business and allowing us to inspire more people worldwide. Together, the two companies will have increased scale and scope, and we will bring those benefits to our clients and partners.”
Blackhawk executive chairman Bill Tauscher added: “The acquisition complements the existing client portfolio of Blackhawk’s incentives business, and enhances solutions for customers requiring global reward and incentive platforms and products. We will also offer new products and capabilities to Grass Roots’ clients.”
Grass Roots will operate as a subsidiary of Blackhawk. Matthew Howe and Jonathan Kenny, co-managing directors of Blackhawk’s UK-based European operations, will lead the Euro operations of Grass Roots. Stewart Rigby, managing director, Blackhawk Asia Pacific, will lead the Asia-Pacific operations of Grass Roots.

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