CCVU Cash Convert

TIDMCCVU

RNS Number : 3559Q

Cash Converters International Ld

18 October 2011

18 October 2011

Cash Converters International Ld

Update on EZCORP Offer and Global Strategic Alliance with Cash Converters

 
 Cash Converters International Limited is pleased 
  to announce that EZCORP, Inc through its wholly 
  owned subsidiary CCV Virginia, Inc has acquired 
  from Cash Converters United LC ("CC United") 
  its rights as sub-franchisor to the Cash Converters 
  brand and name in several states in the USA. 
  Since 2001, CC United has held a licence to the 
  territories of Virginia, North Florida and Eastern 
  Pennsylvania. Under its licence, it has the exclusive 
  right to develop Cash Converters stores within 
  its territory and is contracted to pay a royalty 
  of 20% of its gross receipts from franchisees. 
  CC United held the First Right of Refusal to 
  purchase the territory rights for the following 
  states at a price of US$2,500 per store times 
  the number of stores projected for the state 
  (being the population divided by 100,000): District 
  of Columbia, Delaware, North and South Carolina, 
  Georgia, Florida, Maryland, Texas, Ohio, New 
  York, Kentucky, Alabama, Tennessee, Louisiana, 
  Mississippi, Arizona, Michigan, Wisconsin. 
  Under its licence CC United has opened and operated 
  seven corporate stores. EZCORP's subsidiary has 
  taken an assignment of all of the rights of CC 
  United and has also acquired all seven Cash Converters 
  stores. It will also be responsible to pay all 
  royalties under the licence. 
  In April 2011, EZCORP acquired the trademark 
  and licensing rights of Cash Converters in Canada, 
  including the franchisor rights with respect 
  to 13 Cash Converters franchised stores in Canada. 
  Since then, EZCORP has opened one company-owned 
  store under the Cash Converters brand and has 
  converted 14 of its existing CASHMAX stores to 
  the Cash Converters format and brand. EZCORP 
  intends to convert the remainder of its 58 CASHMAX 
  stores to the Cash Converters brand over the 
  next year. 
  As a result of these transactions, there are 
  no sub-franchisors or trade mark licensees within 
  the USA and Canada other than wholly owned subsidiaries 
  of EZCORP. Cash Converters International Limited 
  played no role in these acquisitions by EZCORP 
  other than providing a formal consent to the 
  assignment of the licences. However, the Company 
  supports these initiatives. The Managing Director, 
  Mr Peter Cumins, said: "We are delighted that 
  the commitment by our major shareholder to the 
  Cash Converters brand has taken such a tangible 
  form. We see this as a very promising start by 
  EZCORP along the path of developing our brand 
  in the USA and Canada to the mutual benefit of 
  both companies." 
  Eric Fosse, EZCORP's President of North American 
  Operations, stated: "This is a strategically 
  important acquisition for several reasons. First, 
  it gives us an immediate footprint in a new geographic 
  area of operations. This area nicely complements 
  our existing operations in Florida, Georgia and 
  Tennessee, allowing us to leverage our existing 
  management infrastructure. Second, it kicks off 
  our utilization of the Cash Converters brand 
  and the buy/sell format in the United States, 
  a strategy we have been pursuing in Canada for 
  several months now with positive results. And 
  third, it provides us with access to additional 
  opportunities to expand our presence, under the 
  Cash Converters brand, across the U.S." 
  Enquiries 
  Cash Converters International Limited 
  Mr D.R. Groom +61 (8) 9221 9111 
  Charles Stanley Securities 
  Dugald J.Carlean / Karri Vuori +44 (0) 20 7149 
  6000 
 

18 October 2011

This information is provided by RNS

The company news service from the London Stock Exchange

END

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