Dollar Financial Corp Consummates Previously Announced Acquisition of Purpose U.K. Holdings Limited, (MEM), the Leading Provi...
April 01 2011 - 8:00AM
Business Wire
Dollar Financial Corp (NASDAQ:DLLR), a leading international
diversified financial services company serving primarily unbanked
and under-banked consumers for over 30 years, today announced that
its wholly owned U.K. subsidiary, Dollar Financial U.K. Ltd., has
completed the acquisition of Purpose U.K. Holdings Limited, the
parent company of Month End Money (“MEM”). MEM, which was
established in 2003, operates under the brand name PaydayUK and is
the market leader in the region, providing loans through both
internet and telephony-based technologies throughout the United
Kingdom. The initial funding for the transaction was provided by a
combination of existing cash and utilization of the Company’s
recently expanded global revolving credit facility. The total
purchase price of the transaction at closing was $195.0
million.
Commenting on the acquisition, Jeff Weiss, Dollar’s Chairman and
Chief Executive Officer, stated, “The expansion of our internet
lending platform through the acquisition of MEM, in concert with
our significant financial services store footprint, which provides
short term consumer loans, secured pawn lending, gold purchasing,
check cashing, money transfer, foreign exchange, and a number of
other products and services, further strengthens and secures our
position as the leading provider of financial services to the
unbanked and under-banked consumers in the United Kingdom. We look
forward to leveraging the MEM management team and their scalable
technology platform, strong business acumen and industry expertise
in the future expansion of our global internet lending platform
both within the United Kingdom and Canada, as well as to other
countries in Europe. As we have experienced little cannibalization
of our store based business from our existing internet sales
channel in both the U.K. and Canada, the expansion of our internet
platform will allow us to reach a new customer demographic in the
market place.”
“It is our mission to be the leading global provider of
financial services to the under-banked and unbanked consumer, which
we refer to as the ALICE demographic (or asset limited, income
constrained, employed). The ALICE customer segment is increasing
all around the globe, and we are squarely focused on expanding our
set of products and services and sales channel delivery platforms
in existing and new markets to meet their growing needs.
Traditional banks are generally not a viable option to help the
ALICE demographic with their short-term credit needs, as the loan
amounts are typically too small for banks to efficiently service
them, while the fees for overdrafts, NSF checks, and other
quasi-short term lending vehicles provided by banks and other
traditional lenders are generally a more expensive alternative for
cash and credit constrained consumers. The development of a global
internet platform, hand-in-hand with our credit analytics group,
will allow us to reach these consumers in an efficient and cost
effective manner.”
For the remaining three months of the fiscal year ended June 30,
2011, the Company anticipates the MEM business will contribute
approximately $7.0 million of incremental EBITDA inclusive of
non-recurring transition expenses. Furthermore, considering
additional non-cash amortization expense related to acquired
intangible assets as a result of the application of purchase
accounting, the MEM business is expected to contribute
approximately $0.05 per fully-diluted share during the fiscal
fourth quarter ending June 30, 2011. The Company anticipates it
will update its earnings guidance for the fiscal year ending June
30, 2011, which will include the MEM transaction, when the Company
announces its financial results for the three months ended March
31, 2011.
About Dollar Financial Corp
Dollar Financial Corp is a leading international diversified
financial services company primarily serving unbanked and
under-banked consumers and small business owners 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 seven countries (Canada, the
United Kingdom, the United States, the Republic of Ireland, Sweden,
Finland 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 December 31, 2010, the Company’s global retail operations
consisted of 1,226 locations, including 1,126 company-operated
financial services stores and 100 franchised and agent locations,
conducting business primarily under the names Money Mart®, Money
Shop®, Insta-Cheques®, The Check Cashing Store®, Sefina® and
MoneyNow® in Canada, the United Kingdom, the United States, the
Republic of Ireland, Sweden, Finland 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:
pending or recent acquisitions and their expected benefits; 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; expected financing initiatives; 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
consummation of announced pending acquisitions, 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 consummate announced pending acquisitions,
successfully integrate any of its acquisitions, obtain acceptable
financing, or attain its published guidance metrics, or that
ongoing and potential future litigation or the various FDIC,
Federal, state, Canadian, U.K. 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. The Company disclaims
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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