will spin off

rewards, said on Monday that it will spin-off its art division,, as an independent company.

After the divestiture, the two companies will become strategic partners, sharing revenue from art sales on and cooperating on a variety of marketing activities, said in a statement. The spin-off will be effective July 31, 2001.

Each company will retain the assets it gained when Ashford acquired, a deal that was announced January 4. Additionally, Ashford will retain a minority equity interest in, and shareholders will continue to own Ashford stock, company officials said.

“We believe Ashford and have developed a strategic partnership that will have a positive impact for both companies,” said David Gow, CEO of “Our new relationship will allow to work independently on growing its art business, while taking advantage of traffic from It will also better position Ashford to reach profitability by the end of the year, by capturing revenue from without incurring ongoing costs.”

The spin-off is the latest component of’s attempt to achieve profitability by the fourth quarter of this year. In recent months, has grown its corporate gifts business, improved marketing efficiency, increased repeat customer purchases, narrowed its product assortment to focus on higher margin products, and significantly reduced operating costs. In addition, the company has recently broadened its reach to luxury goods customers through agreements with such well-known brands as eBay, Northwest Airlines World Perks, Sharper Image and MSN.

“We value our relationship with Ashford and look forward to working with the company on a number of marketing initiatives,” said Toni Sikes, the founder of, said in the statement “With Ashford’s support, we will regain our independence as a standalone company and focus on selling art through our website and catalog.”

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