AUSTIN, Texas, Dec. 20, 2012 /PRNewswire/ -- EZCORP, Inc. (NASDAQ: EZPW) has completed three investments that further expand its capacity to provide customers with instant cash solutions where they want, when they want and how they want. These investments enlarge the Company's global distribution network, add or enhance delivery channels and bring highly skilled, innovative talent to organization. The Company today announced today the following developments:
- It has closed the previously announced acquisition of U.S. online lender Go Cash;
- It has increased its investment in Cash Converters International Limited; and
- It has begun expansion in the Arizona market through the 12-store acquisition of USA Pawn & Jewelry.
Jump Starts Online Lending Business
EZCORP today completed the previously announced purchase of Go Cash, a U.S. based online lender. James R. Carnes, the founder and president of Go Cash and an industry leader, has joined EZCORP as President, Online Services. He will lead a management group with significant experience in online lending; an internal decision science analytics team to support stores, channels and products, both domestically and internationally; and experienced customer service and collections call center staff.The performance-based purchase price consists of an initial payment of $27 million (which was paid at the closing) and guaranteed supplemental payments of $11 million at the end of the first year and $6 million at the end of each of the second and third years. The performance element will be based on the net income generated by the business. At the end of each of the first four years following the closing, EZCORP will make a contingent supplemental payment equal to six times net income (subject to certain adjustments), minus all consideration payments previously paid. For the $27 million closing payment, EZCORP issued 1,400,198 shares of its Class A Non-Voting Common Stock valued at $19.283 per share, the average closing sales price for the preceding ten trading days. Paul E. Rothamel, EZCORP's President and Chief Executive Officer, stated: "The Go Cash acquisition supports our multi-channel and product strategy, and provides us with the capability to quickly build a significant online presence with a seasoned management team, proven underwriting models and a sizable list of potential customers. We also plan to leverage the Go Cash platform to provide innovative loan products that allow customers to better interact with us when and how they want — whether it be online, in stores or a combination." The Online Services business unit will be managed by Change Capital, the EZCORP division that leads and manages EZCORP's strategic investment program. Change Capital's mission within EZCORP is to add markets, channels, products and talent, and to identify synergies and implement global best practices throughout all EZCORP business units and affiliates. Its portfolio of businesses currently includes Albemarle & Bond Holdings PLC (ABM.L), Cash Converters International Limited (CCV.ASX), Crediamigo, TUYO and Cash Genie.
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