Blackstone Group LP agreed to buy Alliance Data Systems Corp., which runs marketing programs and processes credit cards for companies including retailers and gas stations, for about $6.76 billion.

Shareholders will receive $81.75 a share in cash, 30 percent more than yesterday's price, Dallas-based Alliance said today in a statement. Blackstone, the private-equity firm founded by Stephen Schwarzman and Peter G. Peterson, will assume $1.1 billion of debt. Alliance senior managers will remain.

Alliance's earnings rose 1 percent in the first quarter as costs climbed and sales increased 15 percent, the slowest pace in almost three years. The company helps clients such as Circuit City Stores Inc. design marketing programs, and it handles credit-card purchases and rewards plans. New York-based Blackstone probably will expand the company before selling it in several years.

``This isn't a split-up story,'' said Larry Berlin, an analyst with First Analysis Corp. in Chicago who rates the shares ``overweight'' and said he doesn't own them. ``They'll let the management build their strategy, make a couple of tuck- in acquisitions and take it public in a couple years for a much higher premium.''

Shares rose $15.39, or 24 percent, to $78.35 at 1:35 p.m. in New York Stock Exchange composite trading. The stock was unchanged this year before today. That compares with a 10 percent increase for the Standard & Poor's Midcap Information Technology Index, which includes Alliance and rivals such as Checkfree Corp. and Acxiom Corp.

Shareholder Support Seen

The 30 percent premium Blackstone plans to pay may be enough to fend off rival offers, Berlin said. Alliance Data said in the statement it expects ``substantially all'' of its shareholders to support the deal.

Blackstone, whose $15.6 billion buyout fund is the second- largest in the industry, plans to go public this year in a deal that may raise $4 billion. The firm, founded in 1985, owns companies with 375,000 employees and $83 billion in annual sales. Alliance, with 9,000 workers, earned $189.6 million last year on sales of $2 billion.

Bank of America Corp. and Lehman Brothers Holdings Inc. are advising Alliance Data, and Evercore Group is the adviser to the special committee to Alliance Data's board. Credit Suisse Group and Blackstone's corporate advisory practice is advising Blackstone.

(Published by Bloomberg, May 17, 2007)