ATLANTA, Sept. 22, 2015 /PRNewswire/ -- Aaron's, Inc.
(NYSE: AAN), a leader in the sales and lease ownership and
specialty retailing of furniture, consumer electronics, home
appliances and accessories, today announced two products to
leverage Progressive's best-in-class point-of-sale presence.
These include an agreement to acquire Dent-A-Med, Inc. d/b/a The
HELPcard®, which offers second look finance programs for
near-prime customers, and the launch of Approve.Me, which provides
a single application for all customers seeking both credit approval
and lease options.
"The HELPcard® and Approve.Me have significant
strategic benefits for our business," said John Robinson, Chief Executive Officer of
Aaron's, Inc. "Our retail partners have been asking us for an
integrated solution to serve customers who are between
Progressive's lease offering and major banks' prime credit
products. We believe these offerings will fill that gap by
creating a 'one-stop shop' at the point of sale for our retail
partners."
"The HELPcard® has a long history and strong track
record and enables Progressive to offer financing solutions for
customers with near-prime credit scores," continued Mr.
Robinson. "Approve.Me is a new application that will give our
retail partners a single point of entry for the entire application
process, from prime credit to leasing options. It creates a
much easier application process for consumers, enabling them to
apply for several options as quickly as possible."
The HELPcard®
Aaron's has agreed to acquire
all of the outstanding stock of Dent-A-Med, Inc. d/b/a The
HELPcard® for approximately $55
million in cash on hand and the assumption of $44 million in debt. The
HELPcard®, based in Springdale, Arkansas, will be operated as a
wholly-owned subsidiary of Progressive Finance Holdings, LLC, which
is a subsidiary of Aaron's, Inc. The transaction is expected
to close within 45 days and not be significant to Aaron's earnings
in 2015.
The HELPcard® subsidiary is expected to enable
Progressive to drive incremental revenue and earnings growth.
It offers retail partners, along with Progressive's existing
product and the new Approve.Me platform, one source for financing
and leasing transactions for below prime consumers. The
HELPcard® will in turn benefit from Progressive's
proprietary technology, infrastructure, and financial capacity.
Founded in 1983, The HELPcard® offers a variety of
open-end financing programs originated through a federally insured
bank. The programs have simple terms that are competitive
with prime credit programs. With approximately $92 million in gross receivables as of
August 31, 2015, The
HELPcard® currently serves more than 700 merchant
partners in over 1,400 locations.
Strategic Benefits
- Enhanced Product for Retail Partners – The
HELPcard® will enhance Progressive's best-in-class
point-of-sale product with an integrated solution for near-prime
customers. The HELPcard® has a centralized,
scalable decisioning model with a long operating history, deployed
through its established bank partners, and a sophisticated
receivable management system.
- Higher Consumer Credit Quality – The
HELPcard® primarily serves consumers with FICO scores
between 600 and 700, which make up about a third of the U.S.
population. These customers generally have greater purchasing
power with stronger credit profiles than Progressive's current
customers.
- Expanded Customer Base – In addition to
complementing Progressive's traditional offering for existing and
prospective retail partners, The HELPcard®'s strong
relationships in consumer services offer an additional channel for
longer-term growth.
Approve.Me
Approve.Me is a proprietary platform
developed by Progressive that integrates with retailers'
point-of-sale systems and provides a single interface for all
customers seeking credit approval or lease options, from prime, to
second look, to Progressive's lease offering.
The platform combines multiple credit and leasing providers into
one application using a single integration. Approve.Me is
compatible with most primary or secondary providers and is designed
to give retailers a faster and more efficient way to service
customers seeking to finance transactions or secure a lease
option.
"Progressive has an industry leading virtual lease-to-own
solution with solid merchant relationships and a strong pipeline
for new retail partners," said Ryan
Woodley, Chief Executive Officer of Progressive. "The
agreement to acquire The HELPcard®, coupled with the
Approve.Me rollout, continues our path to drive innovation to serve
more customers and generate more revenue for our retail partners.
In addition, we have a high regard for Dent-A-Med founder Dr.
Warren Center and his management team, and look forward to
welcoming them to Progressive."
Benefits to Retail Partners
- Established Product – Approve.Me has been
successfully piloted and is currently being used in over 2,000
retail doors.
- Increased Sales – Approve.Me's streamlined
approach sends customer applications through each option, from
primary, to second look, to Progressive's no-credit-needed lease
option, quickly and seamlessly. This more efficient process
typically results in higher overall approval rates.
- Ease of Use – By using a single application,
Approve.Me reduces the time for the application and approval
process from about an hour (for multiple applications) to just a
few minutes.
- Improved Analytics - Approve.Me gives retail partners
access to a comprehensive view of credit decisioning and lease
options, thereby allowing partners to better analyze and improve
their overall financing/leasing flow.
Aaron's will hold a conference call to discuss its agreement to
acquire The HELPcard® and the launch of Approve.Me on
September 22, 2015 at 2:00 p.m. Eastern Time. The public is
invited to listen to the conference call by webcast accessible
through the Company's Investor Relations website,
investor.aarons.com, in the "Investor Relations" section. The
webcast will be archived for playback at that same site.
About Aaron's, Inc.
Aaron's,
Inc. (NYSE: AAN), a leader in the sales and lease ownership
and specialty retailing of furniture, consumer electronics, home
appliances and accessories, has more than 2,000 Company-operated
and franchised stores in 48 states, the District of Columbia, and Canada.
Aaron's was founded in 1955, is headquartered
in Atlanta, and has been publicly traded since
1982. Progressive, a leading virtual lease-to-own company,
provides lease-purchase solutions through more than 16,000 retail
locations in 46 states. Aaron's, Inc. includes the
Aarons.com, ShopHomeSmart.com, and ProgLeasing.com brands.
For more information, visit www.aarons.com.
"Safe Harbor" Statement under the Private Securities
Litigation Reform Act of 1995: Statements in this news release
regarding Aaron's, Inc.'s business that are not historical facts
are "forward-looking statements" that involve risks and
uncertainties which could cause actual results to differ materially
from those contained in the forward-looking statements. Such
forward-looking statements generally can be identified by the use
of forward-looking terminology, such as "will," "believe,"
"expect," "estimate," "anticipate," and similar terminology. These
risks and uncertainties include such factors as our ability to
promptly consummate the acquisition of Dent-A-Med and, thereby,
execute on our strategy of offering The HELPcard® in
order to gain an entry point into the "second look" sales financing
market. In addition, there is the risk that we may not be able to
successfully expand The HELPcard® as we currently
anticipate and/or that our Approve.Me proprietary platform is not
widely accepted by our retail partners. Other risks and
uncertainties include the application of additional laws or
regulations that may result in changes in the way our operations
are regulated, which could expose us to increased regulatory
oversight, more burdensome regulations and increased litigation
risk. Furthermore, changes in general economic conditions,
competition and pricing as well as risks related to the continued
integration of our acquisition of Progressive and the execution and
results of our new strategy (which are discussed in greater detail
under "Risk Factors" in our Annual Report on Form 10-K for the
fiscal year ended December 31, 2014
as well as our Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 2015) could also cause
actual results to differ materially from those contained in the
forward-looking statements included in this press release.
Statements in this release that are "forward-looking" include
without limitation: statements regarding the strategic and
financial benefits of The HELPcard® and Approve.Me
platform for our business, the timing of the expected closing of
the Dent-A-Med acquisition, and the benefits of the Approve.Me
platform to Progressive's retail partners. You are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date of this press release. Except as required
by law, the Company undertakes no obligation to update these
forward-looking statements to reflect subsequent events or
circumstances after the date of this press release.
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SOURCE Aaron's, Inc.