Advance America/Grupo Elektra
On February 16, 2011, Advance America, Cash Advance Centers, Inc. (NYSE: AEA) and subsidiaries of Grupo Elektra, S.A.B. de C.V. entered into a definitive agreement under which Grupo Elektra will acquire control of all of the outstanding shares of Advance America, a leading U.S. short-term lender, for $10.50 per share in cash, representing a 32.7% premium to the Company's closing price of $7.91 on February 15, 2012 . The total transaction value is approximately $780 million, including the Company's outstanding debt as of December 31, 2011.
Advance America's Board of Directors unanimously approved the transaction and recommends that its stockholders vote in favor of the transaction. Under the terms of the merger agreement, Advance America may solicit acquisition proposals from third parties for a period of 45 days and subject to the terms of the agreement, may, at any time, respond to an unsolicited proposal that its Board of Directors determines would be reasonably likely to result in a superior proposal. The Board of Directors of Advance America, with the assistance of its advisors, will actively solicit acquisition proposals during this 45-day period. There can be no assurance that this process will result in a superior proposal. If there is not a superior proposal, the transaction is expected to close during the first half of 2012.
The transaction is subject to customary closing conditions, including receipt of regulatory approvals and approvals by Advance America stockholders. Advance America stockholders will continue to receive their regular quarterly dividends of $0.0625 per share, if and when declared by its Board of Directors, until the transaction closes. Grupo Elektra and its subsidiaries will finance the transaction with cash on hand together with borrowings.
It is expected that Mr. O'Shaughnessy and other key members of senior management will continue in their roles with the Company after the transaction is completed and that Advance America's headquarters will remain in Spartanburg, South Carolina.
Stephens Inc. is serving as financial advisor to Grupo Elektra and Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as legal counsel to Grupo Elektra. Wells Fargo Securities, LLC is serving as financial advisor to Advance America and rendered a fairness opinion regarding the transaction to Advance America's Board of Directors. K&L Gates LLP is serving as legal counsel to Advance America.
Advance America's Board of Directors unanimously approved the transaction and recommends that its stockholders vote in favor of the transaction. Under the terms of the merger agreement, Advance America may solicit acquisition proposals from third parties for a period of 45 days and subject to the terms of the agreement, may, at any time, respond to an unsolicited proposal that its Board of Directors determines would be reasonably likely to result in a superior proposal. The Board of Directors of Advance America, with the assistance of its advisors, will actively solicit acquisition proposals during this 45-day period. There can be no assurance that this process will result in a superior proposal. If there is not a superior proposal, the transaction is expected to close during the first half of 2012.
The transaction is subject to customary closing conditions, including receipt of regulatory approvals and approvals by Advance America stockholders. Advance America stockholders will continue to receive their regular quarterly dividends of $0.0625 per share, if and when declared by its Board of Directors, until the transaction closes. Grupo Elektra and its subsidiaries will finance the transaction with cash on hand together with borrowings.
It is expected that Mr. O'Shaughnessy and other key members of senior management will continue in their roles with the Company after the transaction is completed and that Advance America's headquarters will remain in Spartanburg, South Carolina.
Stephens Inc. is serving as financial advisor to Grupo Elektra and Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as legal counsel to Grupo Elektra. Wells Fargo Securities, LLC is serving as financial advisor to Advance America and rendered a fairness opinion regarding the transaction to Advance America's Board of Directors. K&L Gates LLP is serving as legal counsel to Advance America.
