Luxury retailer Saks Inc. has sold for $1.4 billion the right to operate its private-label credit card business and most accounts as well as outstanding balances on those accounts.
Household International, the new owner, is a leading provider of consumer finance products and owns brands like HFC and Beneficial. The deal seeks to combine Birmingham, AL-based Saks' experience in customer account service — a function it retains — with Household's risk and database management specialty.
As a result, both companies will pool marketing analysis and database management to boost tailored products and promotions. Saks has 4.6 million active cardholders, and purchases made via its card account for 43 percent of company sales. Saks will use the credit card program's sales proceeds to buy back stock.