ChoicePoint to retain its marketing services business
ChoicePoint Inc.'s board of directors has decided to retain its marketing services business.
The company had announced in July its intention to divest this business as part of the companywide strategic review. ChoicePoint Precision Marketing, a leading provider of direct marketing technologies and services, has approximately 670 employees in offices around the country.
"This is not a business that we have to sell," said Doug Curling, president and chief operating officer of ChoicePoint, Alpharetta, GA.
"It is fundamentally sound, with great customers and adds positively to our earnings and cash flows," he said. "While not strategically centric to the rest of our risk management products and services, it fits dead on with our customer base and our business model of helping customers make financial decisions."
Derek V. Smith, ChoicePoint chairman/CEO, said in a statement that the company is retaining the business because it was not able to receive an acceptable offer.
" Despite the company's previously stated desire to divest this business, we have been unable to obtain a fair market price, particularly given the recent downturn in one of our leading customer segments, the mortgage market," Mr. Smith said.
"After considering our options, it became clear to the board that the best interests of our shareholders and customers were served by running this business as part of our continuing operations, rather than seeking to sell in the face of current market conditions," he said.
ChoicePoint collects data on individuals, including Social Security numbers, real estate holdings and current and former addresses.
The company also offers businesses, government agencies and nonprofit organizations software technology and information designed to anticipate and respond to economic and physical risk. It analyzes information for the insurance sector and holds about 19 billion records.
ChoicePoint said it will continue with its plans to sell its forensic DNA analysis laboratory and shareholder services business.
In July, ChoicePoint said it was selling its businesses as part of a companywide strategic review and that it would continue normal operations at the affected businesses until they are sold.
ChoicePoint has made several changes to the way it does business since thieves accessed its massive database of consumer information in 2004.
In January, ChoicePoint agreed to pay $15 million to settle Federal Trade Commission charges related to allegations the company's security and record-handling procedures violated consumers' privacy rights during the breach.
The data breach involved thieves posing as small business customers who gained access to ChoicePoint's database, possibly compromising the personal information of 163,000 Americans, according to the FTC.
The company discovered the breach more than four months before disclosing it to the public in February 2005. ChoicePoint has said authorities initially asked it to keep the information secret.