SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 10, 1997
Mercury Finance Company
(Exact name of registrant as specified in charter)
Delaware 1-10176 36-3627010
(State of other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 Field Drive, Lake Forest, Illinois 60045
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (847) 295-8600
N/A
(Former name or former address, if changed since last report)
Item 5. Other Events.
On January 10, 1997, the registrant entered into an Agreement and Plan of
Merger with Bank of Boston Corporation providing for the purchase by the
registrant of all of the stock of Fidelity Acceptance Corporation in exchange
for 32,708,333 shares of common stock of the registrant.
On January 10, 1997, the registrant issued a press release announcing the
transaction, a copy of which is attached as Exhibit 99.1 to this Form 8-K and
incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description of Document
99.1 Press release dated January 10, 1997 issued by the
registrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
Mercury Finance Company
Date: January 14, 1997 By: /s/ Bradley S. Vallem
Its:AVP & Treasurer
MERCURY FINANCE COMPANY
100 FIELD DRIVE, SUITE 340
LAKE FOREST, ILLINOIS 60045 NEWS RELEASE
CONTACT:
JAMES A. DOYLE
(847)295-8600
OR
FOR IMMEDIATE RELEASE BRADLEY S. VALLEM
(847)295-8600
MERCURY FINANCE TO ACQUIRE FIDELITY
ACCEPTANCE FROM BANKBOSTON
3:30 p.m. (CST) January 10, 1997 - Lake Forest, Illinois - Mercury Finance
Company (NYSE:MFN) announced today that it has signed a definitive agreement
with BankBoston Corporation ("BKB") for the acquisition of BKB's consumer
finance subsidiary, Fidelity Acceptance Corporation ("FAC"). The acquisition is
expected to close in the first quarter of 1997 and is subject to the receipt of
regulatory approvals.
The definitive agreement approved by the Boards of Directors of MFN and BKB
calls for MFN to issue 32,708,333 common shares to BKB, based upon the closing
share price of MFN common stock on January 7, 1997 which was $12.00 per share.
The shares to be issued will represent approximately 16% of MFN's total
outstanding common shares.
MFN's Chairman and CEO, John Brincat, stated: "The acquisition of FAC will
reinforce MFN's position as one of the nation's leading consumer finance
companies. Consistent with our selective acquisition strategy, this transaction
presents a significant opportunity to accelerate the implementation of our
branch growth strategy and to increase cross-selling opportunities, while
affording certain potential consolidation opportunities. We expect that the
acquisition will be accretive to earnings per share in 1997." Mr. Brincat also
said, "We are proud to have BankBoston, one of the nation's leading banks, as
our largest shareholder."
In connection with the transaction, MFN expects to refinance approximately $700
million of FAC debt. Salomon Brothers Inc., which is acting as financial
advisor to MFN, has provided a financing commitment with respect to the debt to
be refinanced.
MFN's Board of Directors approved, in connection with the acquisition, that
MFN's previously authorized nine million share repurchase program be increased
to 18 million shares. Mr. Brincat further stated: "Contemporaneously with the
acquisition, we expect to initiate share repurchases to bring the debt-to-equity
ratio of the combined companies more in line with industry norms."
MFN, established in 1983, is a diversified specialty consumer finance concern
engaged in the business of purchasing individual installment sales finance
contracts from automobile dealers and retail vendors, extending short term
installment loans and offering credit cards to customers. MFN also underwrites
and sells credit related insurance and other ancillary products. MFN has a
diversified consumer finance portfolio with net finance receivables of over $1.2
billion, assets of over $1.6 billion and common equity of approximately $330
million at September 30, 1996. MFN has approximately 300 offices strategically
located in 31 States nationwide.
FAC, established in 1928, is principally engaged in extending direct cash loans
to non-prime borrowers secured by automobiles and also purchases sales finance
contracts secured by automobiles from dealers. FAC has assets of over $1.0
billion, net finance receivables of approximately $962 million, and
stockholders' equity of approximately $277 million at September 30, 1996. FAC
has approximately 160 offices in 31 States and Guam. FAC was acquired by BKB in
1993 through its acquisition of Society for Savings Bancorp, Inc.
Management of MFN will be holding a conference call Monday, January 13 at 10:00
a.m. (CST) to discuss the acquisition. The number to dial is (847)413-2905.
