Marketing agency Harte Hanks plans to sell its 3Q Digital subsidiary two years after buying it from David Rodnitzky, who founded the company in 2008, for $30.2 million in cash.
Harte Hanks focuses on direct-mail marketing and acquired 3Q Digital in March 2015 to support online search. It operates in 11 states, four European countries and the Philippines.
The sale is expected to reduce costs, "simplify operations and provide additional liquidity,” Harte Hanks stated.
“We believe 3Q Digital is a highly attractive asset and its sale will unlock its maximum value for our stockholders,” Harte Hanks CEO and president Karen Puckett stated.
The company expects to continue to partner with 3Q Digital after the sale.
Sources tell Search Marketing Daily that Harte Hanks is late in filing its financial results for the fourth quarter and full year in 2016. The company estimates it lost up to $405 million in revenue from continuing operations and blames the misstep for a reduction in mail volume.
Harte Hanks has secured a two-year $20 million credit facility from Texas Capital Bank. The company intends to use the credit facility for working capital and general corporate purposes. The credit facility is being guaranteed by certain members of the Shelton family, descendants of one of the company's founders.
In aggregate, they own approximately 5% of the company's stock, according to the statement.