2023-03-10 07:31:25 ET
Bank of Montreal ( NYSE: BMO ) agreed on Friday to acquire LoyaltyOne's Air Miles Reward Program business, bringing full ownership of the rewards program back to Canada.
LoyaltyOne's Air Miles, a subsidiary of Plano, Texas-based Loyalty Ventures ( NASDAQ: LYLT ), filed for bankruptcy proceedings in Ontario, while its parent filed for Chapter 11 proceedings in Texas.
Financial terms of the acquisition weren't disclosed. The acquisition is subject to court approval the receipt of required regulatory approvals and other customary conditions.
"If our acquisition of the Air Miles business is successful, we will bring the ownership of Air Miles home to Canada and strengthen its offering for Canadian consumers and businesses together with leading Canadian, global and online program partners and merchants," said Ernie Johannson, group head, North American Personal & Business Banking, at BMO ( BMO ).
The acquisition had been proposed as part of LoyaltyOne's ( LYLT ) proceeding under the Companies' Creditors Arrangement Act (Canada) commenced in the Ontario Superior Court of Justice on Friday. LoyaltyOne's CCAA proceeding will involve a solicitation process to seek any other interest in the Air Miles business.
"As a founding partner of the Air Miles program since 1992, BMO ( BMO ) is well positioned to strengthen and grow Canada's most recognized loyalty program," the company said. The rewards program has almost 10M active collector accounts, representing almost two-thirds of Canadian households, it said.
Loyalty Ventures ( LYLT ) stock sank 45% in Friday premarket trading.
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BMO agrees to acquire LoyaltyOne Air Miles, after Loyalty Ventures bankruptcy