Blackhawk Network, a financial technology company, has acquired CashStar, a gift card commerce solutions provider, for a cash transaction valued at $175m.
CashStar’s commerce platform allows retailers to market and distribute digital and plastic gift cards directly to consumers and businesses across various channels.
Leveraging CashStar’s flexible platform, merchants can use digital and physical gift cards to retain consumers across the customer lifecycle, such as marketing and promotions, sales and customer service.
Blackhawk said that CashStar will boost its product offering and expend merchant relationships. It will also provide retailers and distributors with more options in mobile and digital distribution.
Blackhawk Network CEO and president Talbott Roche said: “The acquisition strategically enhances Blackhawk’s ability to provide the right digital solutions to our partners to meet the changing needs of business customers and consumers.
“With the addition of CashStar, Blackhawk is now a leading provider in the fast growing first-party digital market. Also, with CashStar margins projected in the range of 25 percent to 30 percent for fiscal 2018, Blackhawk maintains its focus on margin expansion.
“Finally, Blackhawk remains committed to optimizing capital allocation to enhance shareholder returns and will continue to evaluate acquisition candidates as well as potential share repurchases in the future.”
Upon completion of the transaction, CashStar will become part of Blackhawk’s digital and incentives businesses.
Ben Kaplan, CEO and president of CashStar, will continue to manage the business and report directly to Blackhawk’s general manager of digital and incentives David Jones.