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Carfinco Expands Into US Market With New Acquisition

Edmonton, Alberta-based Carfinco Financial Group Inc. revealed this week it is expanding into the U.S. market with a new acquisition.

The company has purchased Massachusetts-based Persian Acceptance Corp. (PAC), an indirect lender in the subprime retail automotive industry, from Peter and Jennifer Miller.

Key members of PAC management will remain in place under the continuing leadership of founder and president Peter Miller, officials explained, and PAC will operate as a subsidiary of the Carfinco.

The acquisition was closed on Sept. 4.

PAC, which is headquartered in Wakefield, Mass., was established in 1998 and is licensed and generates receivables in Massachusetts, New Hampshire, Maine, Connecticut and Vermont. It currently has an active base of 362 dealers who source vehicle sales finance contracts for PAC.

PAC currently has $42.7 million in finance receivables.

Commenting on the news, Tracy Graf, chief executive officer of Carfinco, said, "We view this as an excellent opportunity for Carfinco, as Peter and Jennifer have built a very successful company that meets the criteria we were looking for in terms of an expansion into the US market.

"We believe the acquisition adds value to our shareholders. Importantly, PAC's growth strategy mirrors Carfinco's, by increasing loan originations and earnings in a controlled and structured manner,” Graf continued.

Terms of the deal were based on a combination of PAC's book value and historical earnings, officials said, and the total consideration was $9.5 million (USD) comprised of $9 million cash and $500,000 in common shares of the Carfinco (55,223 common shares of Carfinco, priced at $9.45 (CDN) per share after exchange rate adjustments). 

“The vendors (Peter and Jennifer Miller) may earn up to $2 million (USD) in additional consideration contingent upon PAC reaching performance targets over the next two years,” the company said.

PAC’s Peter Miller also commented on the deal, noting, "Jennifer and I are thrilled to be joining forces with Tracy and Troy Graf and the entire Carfinco organization. Combining the individual strengths and synergies of both companies will provide a unique opportunity for PAC to become a major player in the U.S. sub-prime auto finance market.”

AutoCanada Adds Chrysler Dealership; Partners With Pentastar Store for Red Cross Donation

AutoCanada Inc. announced this week it has obtained approval from Chrysler Canada to purchase the operating assets and real estate of Eastern Chrysler Plymouth Inc., which owns and operates a Chrysler Dodge Jeep Ram dealership in Winnipeg, Manitoba.

The 66-year-old dealership, now part of the AutoCanada dealership group, retailed 660 new vehicles last year and 470 used units.

The dealership operates out of a single facility with a total building size of approximately 42,500 square feet, including a service department consisting of 18 service bays, a body shop consisting of 20 service bays and a six-car showroom, the company reported.

"Eastern Chrysler is a very well-run store located in Winnipeg, Manitoba, proudly owned and operated by the Rewucki family since the store's inception in 1946, which has a very strong customer focused business with a proud heritage," said Pat Priestner, chief executive officer of AutoCanada. 

"We would like to thank the Rewucki family for the opportunity to welcome the employees of Eastern Chrysler to the AutoCanada family, and to reconfirm our commitment to continue to operate the Dealership with a strong customer focus and to build on the very fine reputation that the owners and the dealership staff have worked diligently to achieve over the years."

The targeted closing date for the transaction is Sept. 9.

In other news to come out of AutoCanada and its relationships with its Chrysler dealerships, the company recently contributed $100,000 to Calgary Red Cross in partnership with Courtesy Chrysler,

The donation was made in support of disaster relief efforts in the community, officials said.

Priestner said, "Calgary has always been our neighbour and with the addition of Courtesy Chrysler Dodge Jeep Ram to the AutoCanada family, we are now a part of the community; a community that has suffered a devastating event and who are in need of assistance. 

"We are proud to be part of the Calgary community and have been very moved by the spirit of its citizens, and we are very happy to be in a position where we, together with our Courtesy Chrysler dealership partner, are in a position to honour the can-do character of this wonderful community, and contribute to the rebuilding efforts of this great City and its wonderful, and undaunted people," he continued.