Blackhawk Buys GiftCards.com
We all love to purchase gift cards. Well, some of us actually generate thousands of miles/points doing it while the majority of the world actually purchases them as gifts. There is no doubt that the gift card space is still relatively new and we have seen a number of players come and go as it begins to mature.
By far the largest company involved with gift cards is Blackhawk Network. On the reselling side they own Cardpool and on the retail side they own GiftCardMall among other sites. Now, it seems they are trying to further consolidate their power within the space. Today, Blackhawk Network announced the acquisition of Giftcards.com and Omnicard.com. (Who also owns SaveYa.)
Deal Terms
According to the press release, here are the terms of the deal:
Effective January 5, 2016, Blackhawk purchased the ownership interests of Omni Prepaid, LLC from Wolfe, LLC which in turn resulted in the acquisition of GiftCards.com, LLC and OmniCard, LLC. The purchase price was approximately $120 million and will be funded using a combination of cash on hand and borrowings under an existing credit facility.
Affect Visa Gift Cards?
Both GiftCardMall and Giftcards.com sell Visa gift cards online. The GiftCardMall Visas sometimes come with PINs and sometimes don’t. They are either issued by Metabank (pin-enabled) or Sunrise Bank (not pin-enabled). Giftcards.com sells pin-enabled Visas from Incomm. It is unclear at this time if the sites will be run separately or if the type of cards being carried will change.
When talking about the merging of products, I worry a bit about what happened with CardLab. CardLab was purchased by Blackhawk last year and their not pin-enabled Sunrise Bank Visas made their way to GiftCardMall. (As explained above.) Hopefully we don’t see those terrible Visas creep into Giftcards.com as well. That wouldn’t be good.
Conclusion
Blackhawk Network is the big player now in the gift card space and is clearly growing at a fast pace. Unfortunately this means that the two biggest & easiest methods of purchasing Visa gift cards online now fall under the same ownership. Only time will tell what that means, but generally less options mean less opportunities.
HT: PDX Deals Guy
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“borrowings under an existing credit facility.” = “all the $500 GCs we could print by 1/5”
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[…] Milestomemories points out, this means that the two online $500 gift card sources, Giftcardmall and Giftcards.com, […]
I’ve bought Sunrise GC at various places and they all had PINs. Unloaded many of them at Kate. Is this a new development with Sunrise and only with Gift Card Mall?
This only refers to Sunrise Bank gift cards sold by GiftCardMall. For some reason they aren’t pin-enabled although they say it is going to be fixed.
You are correct that Sunrise Bank Visas sold in-stores are definitely pin-enabled and do work to liquidate to Bluebird and Serve.
Thanks for the caveat of GCM.
My immediate thought is how will this affect Staples.com purchases? (Not to mention the impending merger of Office Depot & Staples)
Consolidation is not my friend…
What impending merger of OD and Staples? Source please?
Staples and Office Depot were merging but it was shutdown by the FTC. Right now they are in negotiations to see if it can still work with concessions. Here is a story covering the latest developments.
http://www.thestreet.com/story/13413286/1/office-depot-odp-stock-soared-staples-merger-remains-possible.html
wow, I was out-of-date. I had thought the idea of Staples & OD merging died when Office Depot was permitted to swallow Office Max. (odd why one was permitted but not the other)…. Yet in my visits to Staples this week (for the visa cards, naturally), I continue to be “impressed” by the consistency of store employees outnumbering customers in the store (often many times over)…..
perhaps this is an area of the market where consolidation kicks in to address over-capacity of a model that worked last century
Wonder if something similar may be hitting the gift card realm too. (I may be overly jaundiced on that — as I’ve been watching how rather low volumes of inventory — Gap, Sears, etc. — can significantly gum up and throttle the gc game — or so it seems to mere me.)
Good post, Shawn, and will be interesting to watch!
@laptoptravel – last I heard, the government put a stop to the merger. Some good news!