Popular, Inc. Agrees to Sell Check Cashing Operation to ACE Cash Express, Inc.
22 Settembre 2005 - 12:05AM
PR Newswire (US)
SAN JUAN, Puerto Rico, Sept. 21 /PRNewswire-FirstCall/ -- Popular,
Inc. (NASDAQ:BPOP) announced that ACE Cash Express, Inc.
(NASDAQ:AACE) will acquire substantially all of the assets of
Popular Cash Express, Inc. ("PCE"), Popular's wholly owned check
cashing business, for $36 million. PCE owns and operates stores in
California, Arizona, Florida and Texas. PCE, unlike most other
check cashing operators in the country, never entered the payday
loan business. Popular, Inc. will subscribe, as part of the
transaction, a subordinated convertible note to be issued by ACE in
the amount of up to $22.5 million. Under the terms of the
Convertible Note Agreement, Popular has the right to convert the
debt into common shares of ACE at a 35% premium over ACE's average
closing share price for the 30 days preceding the initial closing
date. If exercised the convertible instrument would give Popular an
ownership interest of 4.99% in ACE based on current outstanding
shares. Popular and ACE also agreed to explore mutually beneficial
opportunities in the areas of transaction processing, cash
management, and working capital and term financing. "We believe
strongly in the potential of this business to serve well the large
and growing low and moderate income segments of the population,"
said Roberto R. Herencia, President of Banco Popular North America.
"This will allow us to hold an investment of the largest publicly
traded player in the retail check cashing business. We remain
committed to the industry as lender and servicer, and will do so
now without being a direct competitor." Richard L. Carrion,
Chairman and CEO of Popular, said, "We have been constrained in our
ability to compete fairly against non-bank owned check cashing
operations. Offering loan solutions has become a key component of
this business model. PCE has built a best-in-class compliance
program, but without clear regulatory and legal guidance on new
services, including lending, for bank-owned retail check cashing
services, PCE cannot meet the demands of its customers." Carrion
added that "Popular will continue providing comprehensive financial
services to the underserved communities. We will remain an active
participant in the industry as a lender and servicer to other
retail check cashing institutions, and will continue to collaborate
with regulators and lawmakers to accelerate the integration of
unbanked and underbanked individuals into mainstream financial
services." Jay B. Shipowitz, President and Chief Executive Officer
of ACE, stated, "The addition of the Popular Cash Express stores,
and more importantly their people, is an opportunity to strengthen
our presence in several key markets and leverage our existing
infrastructure. Consistent with our growth plans, we will continue
to combine new store openings with opportunistic acquisitions like
Popular Cash Express. We welcome their customers and their 333
employees to the ACE network of over 1,370 stores." The agreements
signed by Popular and ACE do not require regulatory approval and
are subject to customary closing terms and conditions. The
transaction is expected to become effective during the month of
October. About Popular, Inc. Popular, Inc. is a full service
financial services provider with operations in Puerto Rico, the
United States, the Caribbean and Latin America. As the leading
financial institution in Puerto Rico with over 280 branches and
offices, the Corporation offers retail and commercial banking
services through its banking subsidiary, Banco Popular de Puerto
Rico, as well as investment banking, auto and equipment leasing and
financing, mortgage loans, consumer lending, insurance and
information processing through specialized subsidiaries. In the
United States, the Corporation has established the largest
Hispanic-owned financial services franchise, providing complete
financial solutions to all the communities it serves. Banco Popular
North America operates over 135 branches in California, Texas,
Illinois, New York, New Jersey and Florida, as well as 112
financial services stores under the name of Popular Cash Express.
The Corporation's consumer finance subsidiary in the United States,
Popular Financial Holdings, operates nearly 200 retail lending
locations offering mortgage and personal loans, and also maintains
a substantial wholesale broker network, a warehouse lending
division, loan servicing, and an asset acquisitions unit Popular,
Inc. continues to use its expertise in technology and electronic
banking as a competitive advantage in its Caribbean and Latin
America expansion, through its financial transaction processing
company, EVERTEC. The Corporation is exporting its 111 years of
experience through the region while continuing its commitment to
meet the needs of retail and business clients through innovation,
and to fostering growth in the communities it serves. Popular is
ranked among FORTUNE magazine's 2005 100 Best Companies to Work
For. About ACE: ACE Cash Express, Inc. is a leading retailer of
financial services, including check cashing, short-term consumer
loans and bill payment services, and the largest owner, operator
and franchisor of check cashing stores in the United States. As of
June 30, 2005, ACE had a network of 1,371 stores in 37 states and
the District of Columbia, consisting of 1,142 company-owned stores
and 229 franchised stores. ACE focuses on serving consumers, many
of whom seek alternatives to traditional banking relationships in
order to gain convenient and immediate access to check cashing
services and short-term consumer loans. ACE's website is found at
http://www.acecashexpress.com/. An electronic version of this
release can be found at the Corporation website,
http://www.popularinc.com/ . For more information: Investor
Relations: Roberto R. Herencia Jorge Junquera President Chief
Financial Officer Banco Popular North America Senior Executive Vice
President 847-994-6599 Popular, Inc. 787-754-1685 Media Relations:
Juan Carlos Cruz Teruca Rullan Vice President Senior Vice President
Public Relations, Communication & Corporate Communications
Leadership Popular, Inc. Banco Popular North America 917-679-3596
847-994-6442 DATASOURCE: Popular, Inc. CONTACT: Investor Relations,
Roberto R. Herencia, President, Banco Popular North America,
+1-847-994-6599; or Jorge Junquera, Chief Financial Officer, Senior
Executive Vice President, Popular, Inc., +1-787-754-1685; or Media
Relations, Juan Carlos Cruz, Vice President, Public Relations,
Communication & Leadership, Banco Popular North America,
+1-847-994-6442, or Teruca Rullan, Senior Vice President, Corporate
Communications, Popular, Inc., +1-917-679-3596 Web site:
http://www.popularinc.com/
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