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ePrize acquired by Connecticut-based equity firm

Catterton Partners, a Connecticut-based private equity firm whose capital totals approximately $2.5 billion, has recently acquired the promotions company, ePrize. The acquisition, according to the CEO, puts the company in a better position for future acquisitions and product expansion.

Catterton Partners acquired a majority stake in the online promotions company by buying out several of its investors, including its founder. Although the CEO declined to offer specifics on the deal, he did indicate that investors were well-compensated. In a comparable recent transaction, Google, Inc. acquired the marketing company, Wildfire, for $250 million, reports say.

ePrize CEO said that the digital marketing/promotions segment is thriving right now. High price tags are the norm. Looking forward, he hopes to expand ePrize's repertoire to include more mobile functionality. He foresees the trend of consumers purchasing items with their phones as indicative of things to come. Given the speed at which the market is moving, he says, it makes more sense to acquire than to try to build from the ground up.

To this end, ePrize has already acquired mobile marketing firm Cellit, Inc. This acquisition added 450 clients to ePrize's base. According to the CEO, several other acquisitions are in the works, though he did not disclose the names of the companies he may be seeking.

The company is currently based in a 46,000-square-foot facility in Pleasant Ridge, but the CEO is considering a move to downtown Detroit. Approximately 300 of its employees reside in Detroit, 50 were hired this year. The company plans to hire 35 more by the end of the year.

ePrize has offices in several states and has worked with high-profile clients such as Coca-Cola Co., Microsoft Corp., HSN, Yahoo, AT&T Inc., and Procter & Gamble Co. In 2011, ePrize saw approximately $50 million in revenue. Projections indicate that number will be closer to $70 million this year.

As companies such as this one decide to expand into further electronic and internet markets, a keen business plan will help them strategize their next step which can lead to smoother transitions and growing profit. A business law attorney can help draft purchase agreements as well as merger and acquisition documentation.

Source: Crain's Detroit Business, "CEO on acquisition of ePrize: Lose Gilbert, gain funds for acquisitions," Dustin Walsh, Aug. 21, 2012

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