Cash Converters International
(ASX:CCV) has announced that it is planning to form a strategic alliance with US-based EZCORP Inc through selling its majority interest in the company.
The second-hand goods and financial services franchise says the alliance is geared towards developing a global suite of financial services products under the Cash Converters brand.
EZCORP’s stake in Cash Converters will rise to 53 per cent after acquiring 30 per cent of the company that it does not already own through a scheme of arrangement.
The offer price of $0.91 cash per Cash Converters share represents a 9.6 per cent premium to the company’s last closing price of $0.83 per share.
Cash Converters chief executive Peter Cumins says access to EZCORP's financial resources, management expertise and systems, expands and accelerates the company’s strategic growth plan.
The board of Cash Converters has formed an independent board committee to consider the transaction and says it unanimously supports the offer, in the absence of a superior proposal.
In the six months to 31 December 2010, Cash Converters International reported a net profit of $14.3 million.
