Cendant & Equivest Announce Definitive Agreement
Cendant Corporation and Equivest Finance, Inc. have announced that they have signed a definitive agreement for Cendant to acquire all of the outstanding common stock of Equivest for $3 per share in cash or approximately $85 million, and all the Equivest preferred stock for about $13 million.
Cendant will also assume approximately $60 million of Equivest corporate debt. For the last twelve months, Equivest reported revenue of $128 million and EBITDA of $30 million.
Equivest, which markets and sells timeshare vacation services and vacation ownership interests, will be fully integrated into Cendant`s Fairfield Resorts unit. The transaction is expected to be accretive to Cendant`s earnings per share immediately, adding $0.01 to adjusted EPS in 2002. Accordingly, Cendant also announced that it has raised the Company`s forecast for 2002 adjusted EPS to $1.26.
Cendant`s Chairman, President and CEO, Henry R. Silverman stated: “We are very pleased with the results at our Fairfield Resorts unit, which for the first time in its history has surpassed $500 million in annual vacation ownership sales. We intend to continue to leverage the strength of the Fairfield management team by pursuing additional tuck in acquisitions within the vacation interval business.”
Concurrent with the execution of the definitive merger agreement with Equivest, Cendant entered into definitive stock purchase agreements to acquire more than 90% of the outstanding shares of common stock and 100% of the outstanding shares of preferred stock from Equivest`s three largest stockholders, the consolidated bankruptcy estate of The Bennett Funding Group, Inc., R. Perry Harris and C. Wayne Kinser.
The transaction is expected to close in the first quarter of 2002 and is subject to customary closing conditions and the approval by the United States Bankruptcy Court for the Northern District of New York of the sale of the shares held by the consolidated bankruptcy estate of The Bennett Funding Group, Inc.
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Richard C. Breeden, chairman, president and CEO of Equivest stated: “Over the past five years, Equivest has built a record as one of the most successful timeshare companies in the nation, achieving substantial compound rates of growth in revenues, net worth and earnings. We are pleased that Equivest`s employees and owners will be in strong and capable hands in the future with Cendant and Fairfield Resorts, and that Equivest`s shareholders will realize a very significant premium over recent market prices from this transaction.” Mr. Breeden was Chairman of the U.S. Securities and Exchange Commission from 1989-1993.
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