Dollar Financial Corp Announces Agreement to Purchase a Leading Internet Lending Business in Scandinavia
August 26 2010 - 7:30AM
Business Wire
Dollar Financial Corp (NASDAQ:DLLR - News), a leading
international diversified financial services company primarily
serving unbanked and under-banked consumers for over 30 years,
announced that it has entered into an agreement to acquire Folkia
Group AS, a leading Scandinavian internet lending business with
headquarters in Stockholm, Sweden. Folkia, which was founded in
2006, currently originates loans through both internet and SMS text
cell phone technology in four countries: Sweden; Finland; Denmark;
and Estonia. The completion of the acquisition is contingent upon
customary closing conditions, including local regulatory approval,
which is expected to take 45 to 90 days to obtain.
Commenting on the announcement, Jeff Weiss, the Company’s
Chairman and Chief Executive Officer, stated, “This acquisition
provides us with an internet and cell phone based lending platform
that was designed to handle the specific requirements for expansion
within Northern Europe and Scandinavia, while also providing the
added benefit of a portable credit and finance license for future
expansion into additional countries in the European Union. We are
pleased to welcome the Folkia management team into the Dollar
family and intend to leverage their expertise in Dollar’s
continuing development of a global internet lending business. We
recently leveraged the internet lending platform we had acquired in
the United Kingdom for expansion into Canada, since that technology
platform was a good fit for the specific nuances of providing
internet loans in the Canadian market. It is our intention to be
the leading global provider of diversified financial services to
unbanked and under-banked consumers. We intend to deliver these
services through whatever means are most preferred and convenient
for our customers, and we see internet and cell phone technology as
emerging components of this multi-channel strategy.”
The purchase price of the acquisition is expected to be
approximately $28.0 million, with a potential for future earn-out
payments depending on the growth of the acquired business over the
next two years following the closing of the transaction. The
Company anticipates the acquisition will be immediately accretive
to earnings, and expects to update its earnings outlook for fiscal
2011 to include the Folkia business when the transaction is
finalized.
About Dollar Financial Corp
Dollar Financial Corp is a leading international diversified
financial services company primarily serving unbanked and
under-banked consumers for over 30 years. Through its retail
storefront locations as well as by other means, such as via the
Internet, the Company provides a range of consumer financial
products and services in five countries, Canada, the United
Kingdom, the United States, the Republic of Ireland and Poland, to
consumers who, for reasons of convenience and accessibility,
purchase some or all of their financial services from the Company
rather than from banks and other financial institutions. The
Company’s products, principally its short-term consumer loans,
check cashing services, secured pawn loans and gold buying
services, provide customers with immediate access to cash for
living expenses or other episodic needs. The Company also offers
high-value ancillary services, including Western Union money order
and money transfer products, electronic tax filing, reloadable
VISA® and MasterCard® debit cards, foreign currency exchange, and
other services. In addition, through its branded Military
Installment Loan and Education Services, or MILES® program, the
Company provides fee based services to enlisted military personnel
applying for loans to purchase new and used vehicles that are
funded and serviced under an exclusive agreement with a major
third-party national bank.
At June 30, 2010, the Company’s global retail operations
consisted of 1,180 locations, including 1,058 company-operated
financial services stores and 122 franchised and agent locations,
conducting business primarily under the names Money Mart®, Money
Shop®, Loan Mart®, Money Corner®, Insta-Cheques® and The Check
Cashing Store® in Canada, the United Kingdom, the United States and
the Republic of Ireland, and Poland. For more information, please
visit the Company's website at www.dfg.com.
Forward Looking Statement
This news release contains forward looking statements,
including, among other things, statements regarding the following:
recent acquisitions; the Company’s future results, growth, guidance
and operating strategy; the global economy; the effects of currency
exchange rates on reported operating results; the developing
regulatory environment in Canada, the U.K., the United States, and
other countries; the impact of future development strategy, new
stores and acquisitions; litigation matters; and the performance of
new products and services. These forward looking statements involve
risks and uncertainties, including risks related to: the regulatory
environments; current and potential future litigation; the
identification of acquisition targets; the integration and
performance of acquired stores and businesses; the performance of
new stores; the impact of debt financing transactions; the results
of certain ongoing income tax appeals; and the effects of new
products and services on the Company’s business, results of
operations, financial condition, prospects and guidance; and
uncertainties related to the effects of changes in the value of the
U.S. dollar compared to foreign currencies. There can be no
assurance that the Company will attain its expected results,
successfully integrate any of its acquisitions, or attain its
published guidance metrics, or that ongoing and potential future
litigation or the various FDIC, Federal, state, Canadian or foreign
legislative or regulatory activities affecting the Company or the
banks with which the Company does business will not negatively
impact the Company’s operations. A more complete description of
these and other risks, uncertainties and assumptions is included in
the Company’s filings with the Securities and Exchange Commission,
the Company’s annual reports and Forms 10-Q and 10-K. You should
not place any undue reliance on any forward-looking statements. We
disclaim any obligation to update any such factors or to publicly
announce results of any revisions to any of the forward-looking
statements contained herein to reflect future events or
developments.
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