MSGi Snatches Up Perks.com

A month after a major reorganization, Marketing Services Group, Inc. said Monday that it will purchase online loyalty marketer Perks.com.

Few details were disclosed about the transaction. MSGi said it would purchase 80 percent of Perks.com in an all-stock transaction, giving the Silicon Alley-based company a sizable controlling interest in the smaller firm.

Two-year-old, Los Angeles-based Perks works like an ASP to help companies set up loyalty marketing efforts. The company provides points and referral calculation, as well as reporting and analysis services. Clients include CitiGroup, Sony and Cendant.

The deal expands MSGi’s suite of capabilities to include promotional marketing. The company handles on- and offline direct marketing, media planning and buying, and strategic planning. MSGi’s clients include American Express, Disney and General Electric.

“The combination will improve the service offerings of both companies and increase their revenue per client by providing a wider range and quality of direct marketing and loyalty solutions to their customer bases,” said Perks chief executive officer Ron Frankel.

That, and Perks.com said it expects to generate revenues of $10 million for the fiscal year ending June 30, 2001.

Monday’s deal comes a little over a month after MSGi announced a major restructuring in the interest of expediting profitability, in which it shut down its WiredEmpire subsidiary, which licensing email marketing tools.

But MSGi executives downplayed the bottom-line ramifications of Monday’s agreement.

“The combination should provide our thousands of customer relationships with a single destination for all their marketing needs, and help us to create even more cost-efficient and targeted customer marketing solutions,” said MSGi chairman and CEO Jeremy Barbera.

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