EQUIVEST FINANCE INC. ANNOUNCES EQUITY INVESTMENT, REVOLVING CREDIT FACILITY AND FORMATION OF A DIVERSIFIED CONSUMER FINANCE DIVISION
HOLLYWOOD, Fla., June 11 /PRNewswire/ -- Equivest Finance, Inc. (NASDAQ: EQUI) is pleased to announce the completion today of a $2 million equity investment by Atlantic Investment Partners, whose partners are Bennett Management & Development Corp. and Queensgate Holdings Ltd. At the same time, Equivest announced the execution of a $20 million revolving credit facility agreement with The Bennett Funding Group, Inc. The Bennett Funding Group, Inc., a commercial finance company headquartered in Syracuse, N.Y., currently generates over $200,000,000 in new business annually in small ticket equipment leasing and origination of consumer receivables. Founded in 1977, Bennett currently operates in all 50 states. Funds from the equity investment and borrowings under the revolving credit facility can be further leveraged and give Equivest the capacity to increase its credit lines further, thereby permitting the company to build a substantial consumer finance portfolio and develop its consumer finance business. This business will focus on purchasing consumer receivables at attractive rates, enhancing the credits, securitizing the receivables and distributing the asset-backed securities. Initially it is anticipated that the consumer receivables acquired by Equivest will consist of resort time-share lease papev. Aloha Funding Corp., an affiliate of Bennett Management and Bennett Funding that has been in the business of originating and securitizing resort lease paper for over 10 years, has expressed a desire to originate such paper through Equivest. Equivest's management believes that Bennett Funding's significant experience in originating, packaging and securitizing consumer finance receivables will further enhance Equivest's ability to handle large volumes of consumer loans. Equivest also announced the termination of the previously disclosed negotiations with the stockholders of 801 Auto Receivables, Inc., a company formed to acquire, warehouse and sell, only insured automobile loans. Under the terms of the completed transaction, Atlantic Investment Partners has acquired 5,000,000 shares of Equivest common stock, representing 70 percent of the outstanding shares after giving effect to such issuance, for its $2 million cash investment. Murray Bacal and Eric Goldberg, directors of Equivest, through their investments in Queensgate Holdings, each have an indirect beneficial ownership interest in approximately 245,333 shares of the Equivest common stock being issued to Atlantic Investment Partners. As a result of the transaction, the conversion ratio on the outstanding Equivest preferred stock will be adjusted to 2.81 common shares for each preferred share and the conversion price on the company's 13 percent convertible debentures shall be adjusted from $5.00 per share to $1.76 per share. Mr. Bacal, who is chairman and chief executive officer of Equivest, stated that Equivest's management believes the equity investment and the credit lines being provided to Equivest, along with the Aloha Funding origination relationship and the relationship being established with Bennett Funding, given its strong track record, should enable Equivest to significantly grow its lending portfolio and should significantly enhance its overall revenues and profitability in the near term. Moreover, management believes that the opportunities to diversify the consumer finance origination and securitization businesses under the Bennett Funding revolving credit facility offer the flexibility to grow such businesses rapidly. Management believes that the cash infusion from the offering, the availability of the $20,000,000 line of credit as a finance tool for a broad range of consumer receivables, including the company's existing premium finance business and the establishment of this close relationship with the Bennett Funding Group Inc. will dramatically enhance the future prospects of the company. Management is confident that the company's prospects with the completion of these transactions should be more favorable to revenues and earnings than would have been the case had it been feasible to instead complete the acquisition of 801 Auto Receivables. Equivest is currently engaged in the insurance premium finance business in Florida and specializes in financing automobile insurance premiums for the non-standard market. The transactions completed today are consistent with Equivest's objectives of diversifying into other consumer finance businesses and enhancing its capabilities to significantly expand its existing premium finance business. -0- 6/11/93 /CONTACT: Philippe Niemetz of Equivest Finance, Inc., 212-344-6464/ (EQUI)
CO: Equivest Finance, Inc. ST: Florida Florida, state, United States
Florida (flôr`ĭdə, flŏr`–), state in the extreme SE United States. A long, low peninsula between the Atlantic Ocean (E) and the Gulf of Mexico (W), Florida is bordered by Georgia and IN: FIN fin, organ of locomotion characteristic of fish and consisting of thin tissue supported by cartilaginous or bony rays. In some fish, e.g., the eel, a single fin extends from the back, around the tail, and along the ventral surface. SU:
LD-TM -- NY063 -- 1271 06/11/93 17:50 EST EST electroshock therapy.