FORT WORTH, Texas., Sep 12, 2006 (BUSINESS WIRE) -- AmeriCredit Corp. (NYSE: ACF) today announced the
pricing of its offering of $250 million principal amount of
Convertible Senior Notes due 2011 and $250 million principal amount of
Convertible Senior Notes due 2013 in a private offering to qualified
institutional buyers pursuant to Rule 144A under the Securities Act of
1933, as amended. The sale of the notes is expected to close on
September 18, 2006.
The 2011 notes were priced at 100 percent of their principal
amounts and have the following terms:
-- $250 million principal amount of 0.75% Convertible Senior
Notes due September 15, 2011.
-- The 2011 notes are convertible prior to maturity, subject to
certain conditions, into cash up to their principal amount,
and into shares of AmeriCredit common stock for the conversion
value above the principal amount, if any, based on an initial
conversion rate of 35.6233 shares of common stock per $1,000
principal amount of the 2011 notes, representing a conversion
price of approximately $28.07 per share. The initial
conversion price represents a 15% conversion premium for the
2011 notes based on the closing price of $24.41 per share on
September 12, 2006.
The 2013 notes were priced at 100 percent of their principal
amounts and have the following terms:
-- $250 million principal amount of 2.125% Convertible Senior
Notes due September 15, 2013.
-- The 2013 notes are convertible prior to maturity, subject to
certain conditions, into cash up to their principal amount,
and into shares of AmeriCredit common stock for the conversion
value above the principal amount, if any, based on an initial
conversion rate of 32.7735 shares of common stock per $1,000
principal amount of the notes, representing a conversion price
of approximately $30.51 per share. The initial conversion
price represents a 25% conversion premium for the 2013 notes
based on the closing price of $24.41 per share on September
12, 2006.
AmeriCredit estimates that the net proceeds from this offering
will be approximately $488 million, after deducting estimated
commissions and expenses. In addition, AmeriCredit has granted the
initial purchasers a 15-day option to purchase up to $25 million
principal amount of additional 2011 notes and up to $25 million
principal amount of additional 2013 notes, in each case, solely to
cover over-allotments.
AmeriCredit intends to use the net proceeds from the offering of
the notes for:
-- The purchase, from affiliates of one or more of the initial
purchasers, of convertible note hedges with respect to
AmeriCredit's common stock. Concurrently with entering into
the convertible note hedges, AmeriCredit issued warrants to
purchase its common stock. These transactions have the effect
of increasing the effective conversion price of the notes,
from AmeriCredit's perspective, to $35 (in the case of the
2011 notes) or $40 (in the case of the 2013 notes), which
represents approximately a 43% premium (in the case of the
2011 notes) or approximately a 64% premium (in the case of the
2013 notes), in each case to the closing price of
AmeriCredit's common stock on September 12, 2006. The net cost
of these transactions was approximately $50 million. If the
initial purchasers exercise their option to purchase
additional notes, AmeriCredit expects to use a portion of the
net proceeds from the sale of the additional notes to enter
into additional convertible note hedge transactions.
AmeriCredit may also enter into additional warrant
transactions, if the over-allotment is exercised. In
connection with establishing their initial hedges of the
convertible note hedge and warrant transactions, AmeriCredit
has been advised that the counterparties to such transactions
or their respective affiliates expect to enter into various
derivative transactions with respect to AmeriCredit's common
stock and/or purchase AmeriCredit's common stock in secondary
market transactions concurrently with, or shortly after, the
pricing of the notes, and may enter into various derivative
transactions with respect to AmeriCredit's common stock and/or
purchase or sell AmeriCredit's common stock in secondary
market transactions following pricing of the notes (and are
likely to do so during any cash settlement averaging period
relating to the notes).
-- The repurchase of approximately $254 million of its common
stock in privately negotiated transactions concurrently with
the offering of the notes.
-- General corporate purposes, including repurchasing shares of
AmeriCredit common stock in the open market or in privately
negotiated transactions from time to time.
This notice does not constitute an offer to sell or a solicitation
of an offer to buy securities. Any offers of the securities will be
made only by means of a private offering circular. The notes and any
AmeriCredit common stock issuable upon the conversion of the notes
have not been registered under the Securities Act or the securities
laws of any other jurisdiction and may not be offered or sold absent
registration or an applicable exemption from registration
requirements.
About AmeriCredit
AmeriCredit Corp. is a leading independent automobile finance
company that provides financing solutions indirectly through auto
dealers and directly to consumers in the United States and Canada.
Except for the historical information contained herein, the
matters discussed in this news release include forward-looking
statements that involve risks and uncertainties detailed from time to
time in the Company's filings and reports with the Securities and
Exchange Commission including the Company's annual report on Form 10-K
for the year ended June 30, 2006. Such risks include - but are not
limited to - variable economic conditions, adverse portfolio
performance, volatile wholesale values, reliance on warehouse
financing and capital markets, the ability to continue to securitize
its loan portfolio, the continued availability of credit enhancement
for its securitization transactions on acceptable terms, fluctuating
interest rates, increased competition, regulatory changes and exposure
to litigation. These forward-looking statements are based on the
beliefs of the Company's management as well as assumptions made by and
information currently available to Company management. Actual events
or results may differ materially.
SOURCE: AmeriCredit Corp.
AmeriCredit Corp.
Investor Relations:
Caitlin DeYoung, 817-302-7394
or
Media Relations:
John Hoffmann, 817-302-7627