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OpenGate Capital to acquire Shoppers business from Harte-Hanks for approximately $22.5 mln

Print and digital marketing company Harte-Hanks has agreed to sell its Shoppers division to OpenGate Capital for approximately $22.5 million in cash. The transaction is expected to close before September 30, 2013. The Shoppers division is also comprised of PennySaver, a provider of print and digital marketing and advertising services.

PRESS RELEASE

BREA, CA – Harte-Hanks, Inc. (NYSE: HHS), an international direct and targeted marketing company, today announced it has entered into a definitive agreement to sell the assets of its Shoppers division to subsidiaries of OpenGate Capital for approximately $22.5 million in cash proceeds. The transaction is expected to close before September 30, 2013 upon satisfaction of customary closing conditions.
Robert Philpott, Harte-Hanks’ President and Chief Executive Officer, commented, “Shoppers joined Harte-Hanks in 1972. The PennySaver brand is very well known in California, with a loyal readership of its publications and a committed advertiser base. The staff on our Shoppers team is dedicated and hard-working. However we believe that the Shoppers business is no longer a good strategic fit with the other businesses within Harte-Hanks. The focus that OpenGate Capital will now give to Shoppers will put it in a much stronger position to thrive. I want to thank everyone in Shoppers for their many years of devoted service and recognize the contribution that they have made to Harte-Hanks.”
“Harte-Hanks is now in the position to focus on our core business. We are in the early stages of the development of a new strategy for the Company. The sale of our Shoppers business will make that process more streamlined and it will enable us to work towards a more precise definition of our own story.”
Harte-Hanks anticipates the transaction will result in a one-time after-tax loss of approximately $15.0 million to $20.0 million, and cash tax savings of approximately $6.0 million to $7.5 million. The company intends to use the proceeds from the transaction for general corporate purposes.
About Harte-Hanks®:
Harte-Hanks® is an international direct and targeted marketing company that provides multichannel direct and digital marketing services and shopper advertising opportunities to a wide range of local, regional, national and international consumer and business-to-business marketers. Harte-Hanks Direct Marketing helps its clients obtain insight about their customers through database and marketing analytics. Based on that insight Harte-Hanks Direct Marketing designs, implements and executes multichannel marketing programs on behalf of its clients using direct and digital communications