Equifax Buys Polk Division for $260MDiversified financial-information repository Equifax sealed an agreement this week to purchase the Consumer Information Services division of the R.L. Polk Co. for $260 million in cash.
Polk will retain its transportation-services businesses, which account for more than half of total revenues, but will sell its Direct Marketing, Data Information Services, Compusearch/Prospects Unlimited and Polk City Directory operations. These units are projected to have combined sales of $165 million in the fiscal year ending March 31.
The acquisition, expected to be completed by April 30, will bolster Equifax's efforts in the direct marketing and customer relationship management industries and will allow Polk to devote more attention and resources toward its transportation services arm.
"What Polk has done is take a look at all of our businesses and came to the recognition that we couldn't do everything we needed to in the traditional direct marketing side as well as do all the things that we needed to do on the transportation side," said Stephen Polk, chairman /CEO of the family owned company. "We thought, being here in Detroit, that being focused on automotive was probably what we do best and needed to concentrate on."
Polk, who will remain at the helm of the transportation-services business, said the operations being sold were profitable last year. Equifax, Atlanta, is acquiring consumer databases that contain a range of lifestyle information used by direct marketers to target their offers. The data, which includes information on 180 million consumers and 105 million households, is obtained from 250 data sources, including some self-reported mechanisms such as mail surveys and product registration cards.
Equifax said it will use the Polk databases to help its clients conduct more targeted marketing efforts, however, its credit-information databases will be maintained separately from the Polk databases. In addition to the databases, the acquired operations include list hygiene and enhancement services, and analytical services. The acquisition includes Polk's Data Information/Polk Verity operations, which serve as the data-acquisition mechanisms for Polk's other business units: Compusearch, which includes geodemographic data and market analyses of Canada; and the Polk City Directory business, which includes data from 225,000 customers in 1,000 small- to mid-sized North American cities.
About 2,000 employees serve in the acquired businesses, including more than 500 field sales representatives for the Polk City Directories. John Healy, senior vice president and general manager of CIS' direct marketing unit, will head up the acquired operations as executive vice president and group executive. He will report to Lee Kennedy, Equifax president and chief operating officer.
"This really injects some growth serum into our North American business," said Equifax chairman/CEO Tom Chapman, who said the Polk businesses have been growing at an annual rate of 7 percent to 8 percent and can be expected to continue to grow. "It's a stampede from mass marketing to targeted marketing and customer relationships. We have been developing a [customer relationship management] franchise for the past year and a half, and what drives that business starts with customer data. In this case, we are acquiring a huge source of consensual, lifestyle data."
Equifax is one of the country's three major credit reporting bureaus and provides payment-processing services for checks and credit cards. It has annual revenues of $1.8 billion and serves clients throughout the world.
Polk's sale of its Consumer Information Services unit ends years of rumors and speculation about its possible sale. Recently, infoUSA was in talks to acquire all or part of the company, according to sources close to the Omaha, NE-database concern.
Polk was founded in 1870 as a publisher of city directories. It added the transportation business in 1922. Equifax was launched in 1899 as the Retail Credit Co. and was renamed Equifax in 1975.