American Greetings to Buy Competitor Gibson

American Greetings Corp., the No. 2 U.S. greeting card company, agreed to buy No. 3 Gibson Greetings Inc. for about $163 million, or $10.25 a share, to increase its British and Internet presence and challenge leader Hallmark Cards Inc. American Greetings will get money-losing Gibson’s British greeting card division, its stake in closely held Egreetings Network and 24,000 products, including cards, gift wrap, party goods and Silly Slammers bean bag characters. Cleveland-based American Greetings will continue to use the 150-year-old Gibson name. It expects the acquisition to save $50 million a year and to contribute to profit in the first year after the transaction is complete. Cincinnati-based Gibson said no decision has been made about its 1,300 employees. News of the deal sent Gibson shares up $3.38, or 61%, to close at $8.88 on Nasdaq. American Greetings shares rose 75 cents to close at $25.81 on the New York Stock Exchange.