Tuesday, Dec. 05, 2006, 07:00 PM UPDATED 11:59 AMBy Nick Zulovich
FORT WORTH, Texas — As a part of AmeriCredit's growth plan, it announced its subsidiary, AmeriCredit Financial Services, is in the process of purchasing Long Beach Acceptance Corp., the near-prime auto finance subsidiary of ACC Capital Holdings.
AmeriCredit Financial Services said it is currently acquiring all outstanding capital stock of Long Beach. The purchase is an all-cash transaction valued at $282.5 million.
According to executives, Long Beach specializes in providing auto financing to customers with near-prime credit scores by acquiring contracts from dealers in 34 states. As of Sept. 30, the company had about $1.7 billion in managed auto receivables.
Long Beach was founded in 1995 and is headquartered in Paramus, N.J., with a Western regional office in Orange, Calif.
"AmeriCredit is committed to offering auto dealers and consumers a full spectrum of auto finance solutions, and the acquisition of Long Beach Acceptance Corp. allows us to add near-prime quality business to our product mix," explained Dan Berce, president and chief executive officer of AmeriCredit.
"With Long Beach's expertise in the near-prime market, combined with AmeriCredit's experience in the subprime market and our Bay View Acceptance prime lending product, we now have the ability to serve customers at any point along the credit spectrum," he added.
Once the acquisition is complete, AmeriCredit said Long Beach will operate as a standalone subsidiary and will continue to be led by Stephen Prough, president and CEO.
"We are very pleased to be joining a well-capitalized and growing company like AmeriCredit," said Prough. "Like Long Beach, AmeriCredit is solely focused on auto finance, and we look forward to working with them to deliver a full spectrum of financing solutions to auto dealers and their customers."