American Greetings, Amscan Enter Distribution Alliance

Elmsford, N.Y.-based Amscan, a manufacturer of party goods, has secured the exclusive rights to distribute American Greetings products to a variety of retailers, including party stores. Due to the deal, AG will begin to wind down its distribution operations.

In the agreement, American Greetings will receive approximately $25 million, as well as a warrant to purchase about 2 percent of Class A Common Stock of AAH Holdings Corporation, Amscan's parent company.

"The transaction with Amscan allows us to provide our retail customers with a broader assortment of party goods products," says Zev Weiss, chief executive officer of American Greetings. "We will be certain to make this a seamless transition to ensure that our retail partners and consumers benefit from the alliance. The decision to change our business model in no way reflects on the hard work or commitment of the affected employees. I would like to thank them for their effort and dedication over the years."