Mexico's Elektra To Buy Advance America For $780 Million
February 15 2012 - 10:48PM
Dow Jones News
Mexican retail and financial firm Grupo Elektra SAB (ELEKTRA.MX)
said late Wednesday it plans to buy South Carolina-based lender
Advance America Cash Advance Centers Inc. (AEA) for $780
million.
The deal, Elektra's first major foray into the U.S. financial
services market, values Advance America at $10.50 per share--a
32.7% premium over the company's closing price Wednesday, Elektra
said in a statement.
Advance America offers cash advance services through
approximately 2,600 locations in 29 U.S. states, the United
Kingdom, and Canada.
"We are eager to expand our services to the United States and to
continue meeting the needs of the financially under-served," said
Elektra Chairman Ricardo Salinas.
Elektra sells items such as appliances on credit, while also
offering banking services. In addition to Mexico, the company
operates in Argentina, Brazil, El Salvador, Guatemala, Honduras,
Panama and Peru.
Under the terms of the agreement, Advance America may solicit
acquisition proposals from third parties for a period of 45
days.
Should no competing proposal arise, the transaction is expected
to close during the first half of 2012.
Key management at Advance America are expected to stay on at the
company following the acquisition, working from Spartanburg,
S.C.
Elektra plans to finance the transaction with cash and
credit.
-By Amy Guthrie, Dow Jones Newswires; mexico@dowjones.com
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