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EZCORP ANNOUNCES NEW AGREEMENT
TO ACQUIRE VALUE FINANCIAL SERVICES
AUSTIN,
Texas (September 16, 2008) ¾ EZCORP, Inc. (Nasdaq: EZPW) announced today that
it has entered into a new merger agreement to acquire 100% of the
equity ownership of Value Financial Services, Inc
(“Value”). The agreement is a successor to negotiations
between the companies that were terminated on August 8, 2008,
and then recommenced in late August.
In the merger
agreement, EZCORP agrees to exchange three-quarters of a share of
EZCORP’s Class A Non-voting Common Stock
(“EZPW”) for each of the approximate 6,646,000 shares
of Value’s common stock. EZCORP also agrees to pay cash
consideration of $11.00 per share in lieu of EZPW shares for up to
20% of the outstanding Value shares.
Assuming
today’s EZPW closing price of $16.35 and that 20% of the
Value shares are acquired with cash, the purchase price will be
approximately $115.9 million plus potential contingent
payments. This purchase price is comprised of $79.8 million
paid to Value shareholders, assumption of estimated debt of
$35.3 million and estimated transaction costs of
$0.8 million.
Assuming 20% of
Value shares are acquired for cash, the consideration paid to Value
Financial Services shareholders will be comprised of
$14.6 million cash and the issuance of approximately 3,988,000
shares of EZPW. The final purchase price will depend on the closing
market price of EZPW on the day prior to closing plus any
subsequent contingent payments as described in the Merger
Agreement.
The transaction
is expected to close by December 31, 2008. The agreement
provides for a $5 million break up fee payable to EZCORP,
should the transaction fail to close due to certain conditions
including the failure of
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