United NewVentures, a wholly owned subsidiary of United Airlines’ parent UAL Corp., has agreed to acquire MyPoints.com Inc. for $106 million in cash.
MyPoints is an Internet direct marketing company that offers advertisers database-driven loyalty programs. Its members receive points for planning a trip, taking surveys, reading e-mails or performing other activities on advertisers’ Web sites. Points can be redeemed for travel or other prizes.
Under the terms of the agreement, United NewVentures will purchase all outstanding shares of common stock of MyPoints for $2.60 per share. The acquisition is subject to MyPoints shareholders tendering their stock.
MyPoints reported revenues of $10 million for the first quarter ended March 31, 2001, down 37% from the same period in 2000. Net loss for the first quarter was $14.4 million, up 32% from the 2000 quarter. MyPoints will continue operations as a separate company headquartered in San Francisco with the technology center remaining in Schaumburg, IL.
United plans to apply MyPoints’ direct marketing capabilities to united.com and Mileage Plus membership programs. In addition, United NewVentures and MyPoints will build new services for their combined customer base. MyPoints’ Program members will now have access to offers from United Airlines. They will also be able to redeem their points for travel awards on United Airlines.
United NewVentures was founded in October 2000 to focus on the airline’s Internet initiatives and investments. United, the world’s largest airline, ranks sixth in terms of airline Internet bookings with sales of $755 million in 2000.