News

Coinstar diversifying operations via purchase of CellCards

March 15, 2004

Coinstar Inc., manufacturer of coin-counting kiosks in supermarkets, is diversifying through its acquisition of CellCards of Illinois LLC.

And that is a win-win situation for the consumer and the retailer, the company says.

CellCards, formerly a majority-owned subsidiary of American Payment Systems, is one the nation's largest distributors of prepaid products that has a strong presence in drug store point-of-sale locations.

The acquisition brings the company's total number of North American distribution points to approximately 25,000.

"By acquiring CellCards, we can now bring our retail partners a total e-payments solution," said Steve Verleye, general manager of Coinstar's Electronic Payment Solutions, in a release.

Added Mike Herold, president of CellCards: "Coinstar's strength in self-service kiosks and broad distribution in supermarkets, combined with our prepaid product offering and drug store penetration, is very complementary and will create great opportunities for cross-selling."

Coinstar brought on board Sam Jonas, an ATM industry veteran and founder of Cash Resources, to accelerate the integration and expansion of the CellCards' business, according to the release.

Founded in 1998, Chicago-based CellCards offers a broad set of prepaid products including wireless, long distance and MasterCard cards. In addition, the company offers bill payment capabilities for utilities and other common services. The company has multi-year agreements with national drug store retailers CVS, Eckerds, and Walgreen.