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Alliance Data to buy Conversant for approximately $2.3 billion

Staff writer |
Alliance Data Systems Corporation announced the execution of a definitive agreement whereby Alliance Data will purchase Conversant.

Under the terms of the agreement, Alliance Data will acquire all outstanding shares of Conversant for a combination of cash and stock valued at approximately $2.3 billion, or $35 per Conversant share.

The purchase price, structured to be paid with approximately 48 percent cash and 52 percent ADS shares, represents 10x Conversant's expected forward adjusted EBITDA of $230 million for 2015. The transaction is subject to regulatory approval and customary closing conditions, and is expected to close by year end. The transaction has been unanimously approved by the boards of directors of the two companies.

Alliance Data expects substantial accretion from the transaction: approximately $0.50 and $0.75 to core EPS in year 1 and year 2, respectively, excluding transaction costs. Importantly, no revenue or cost synergies have been factored into the accretion estimates. Post-closing, Conversant will operate as part of Epsilon.

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