![]() The transaction is expected to have Tier 1 capital impact on closing of approximately 55-60 basis points on a pro forma basis as at TD’s last year-end. The Chrysler Financial management team and sales force have a proven track record and extensive industry experience and will complement our existing lending expertise.” “It ensures that the acquired businesses will be part of a strong and well-capitalized financial institution, which will help create sustainable jobs.”Ĭlark concluded: “This transaction takes our auto finance business to a new level and gives us access to a North American platform, top talent and systems and technology capable of processing over 2 million credit applications per year. “This transaction with TD is the right next step for the future of these businesses, their employees and customers,” said Mark Neporent, Senior Managing Director and Chief Operating Officer, Cerberus. TD expects to rebrand Chrysler Financial under the TD brand by spring 2011. Following the completion of the transaction, Chrysler Financial will continue to operate as a North American business overseen by Tom Gilman and headquartered in Toronto. The acquisition is expected to close in the second quarter of TD’s fiscal 2011, pending regulatory approvals and satisfaction of other customary closing conditions. This transaction positions us for future growth with the financial strength of TD, one of the soundest, best capitalized and best managed banks in the world.” “Under Cerberus’s ownership, Chrysler Financial has preserved its technology platform, retained top talent and maintained key capabilities. “Joining forces with TD will benefit both our customers and our dealer network,” said Tom Gilman, CEO, Chrysler Financial. Chrysler Financial plans to focus on the prime market. It comprises about $650-700 billion in outstanding receivables and $350-400 billion in annual originations on a normalized basis. In the U.S., the automotive finance industry is the second largest non-mortgage consumer asset class after credit cards. It is one of the largest auto financing firms in North America, with a strong service culture. With about 1,850 employees in Canada and in the United States, Chrysler Financial has more than 45 years of operating experience in the consumer and commercial auto financing market. ![]() TD expects that the business could generate a return on invested capital of approximately 20% in three to four years, once it is operating at a steady run rate for target originations. ![]() In addition to the existing dealer relationships that TD has in Canada and the U.S., Chrysler Financial’s dealer clients serve approximately 1 million customers. The acquisition will give TD a platform for asset generation in the North American automotive lending market, enabling it to significantly grow its consumer loan portfolio. This acquisition gives us that opportunity and also diversifies our lending portfolio.” This acquisition will allow us to leverage our lending expertise and financial strength to expand our presence in a large North American market with tremendous potential upside.”Ĭlark continued: “Because we’re well-capitalized and a leading deposit franchise, we’ve been looking for opportunities to accelerate the growth of our loan book. “Chrysler Financial is a well-run business with the capacity for significantly higher returns over the next several years. ![]() “This transaction represents a unique opportunity to purchase a great organic growth platform at an attractive price,” said Ed Clark, Group President and CEO, TD. Following this transaction, the business – combined with TD’s current platforms in Canada and the United States – will be positioned as a top 5 bank-owned auto lender in North America. The acquisition will give TD all of Chrysler Financial’s processes and technology as well as its existing portfolio of retail assets on both sides of the border. and TD will acquire Chrysler Financial in Canada. Under the terms of the agreement, TD Bank, America’s Most Convenient Bank®, a wholly-owned subsidiary of TD, will acquire Chrysler Financial in the U.S. TD does not intend to issue common equity in connection with this transaction. The purchase is comprised of net assets of $5.9 billion and approximately $400 million in goodwill. (Cerberus), today announced an agreement under which Chrysler Financial will be sold to TD for cash consideration of approximately $6.3 billion. ![]() TORONTO, Canada, Decem– TD Bank Group (TD) (TSX and NYSE: TD), and Cerberus Capital Management, L.P. ![]()
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