Press Release
LMG ACQUIRES CONTROLLING INTEREST IN MIDDLE EAST AIR MILES PROGRAMME
Date: 17 January 2008
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Aeroplan Income Fund (Aeroplan) (TSX: AER.UN) and its wholly-owned subsidiary, Loyalty Management Group (LMG), owner and operator of Nectar, today announced LMG's first international acquisition transaction by increasing its stake in Rewards Management Middle East Limited (RMMEL).
LMG has purchased an additional participation of 40% in RMMEL, the operator of Air Miles programmes in the UAE, Qatar and Bahrain, for a purchase price of AED40 million (£5.3 million), which values RMMEL at AED100 million (£13.3 million). As a result of this transaction, LMG will own 60% of RMMEL.
RMMEL was founded in 2000 by LMG, HSBC and Al-Seer (owner of the Spinney's supermarket chain in Dubai) as shareholders, in order to launch an Air Miles-branded retail coalition loyalty programme in the region. LMG acquired the 40 percent ownership held by Al-Seer, increasing LMG's total participation to 60 percent. The remaining 40 percent will continue to be held by HSBC. As part of the transaction, both HSBC and Al-Seer, who are participants in the Air Miles programme in the region, have renewed long-term contracts.
LMG CEO Alex Moorhead said: "LMG looks forward to continuing its strong relationship with HSBC and working more closely with the RMMEL Management team to consolidate its loyalty leadership position in this fast growing region."
"It is a perfect example of executing our international strategy to become the global leader in the management of loyalty programmes," added Rupert Duchesne, President and CEO of Aeroplan.
The Air Miles Middle East programme is currently receiving over 15,000 new membership applications per month. RMMEL also operates the 'my reward' points schemes for HSBC in Egypt, Jordan, Oman and Lebanon. Current RMMEL management and day-to-day operations will remain unaffected.
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