MCLEAN, Va., Sept. 22 /PRNewswire-FirstCall/ -- Capital One Financial
Corporation (NYSE: COF) and Onyx Acceptance Corporation (Nasdaq: ONYX) today
announced the signing of a definitive agreement under which Capital One will
acquire Onyx for $191 million in an all-cash transaction.
The acquisition will combine Capital One Auto Finance, Inc. (COAF), an
auto finance provider through auto dealers and direct to consumers, with Onyx.
This acquisition significantly expands COAF's dealer relationships, deepens
its coast-to-coast market penetration, and enhances its product line,
especially among prime borrowers. During the twelve months ended June 30,
2004, Onyx originated $2.5 billion in auto loans through more than 12,000
active dealer relationships. Ranked by annual originations, the acquisition
will create the second largest independent auto lender in the United States.
"Auto finance is an important component of our diversification strategy
and contributor to our bottom line," said Richard D. Fairbank, Chairman and
Chief Executive Officer of Capital One. "This acquisition provides expanded
growth opportunities and creates synergies that will generate value for our
Onyx's senior management, led by President and Chief Executive Officer
John Hall, will play an important role in Capital One Auto Finance's business.
Hall will report to Capital One's Executive Vice President and President of
Capital One Auto Finance David R. Lawson.
Hall said, "Onyx is pleased to join Capital One Auto Finance, which has
evolved as a leader in auto finance over the last few years. This combination
allows us to bring full spectrum product offerings and direct marketing
programs to our dealers."
"This transaction combines two strong franchises with complementary
strengths," said Lawson. "Onyx's significant and long-standing presence with
California dealerships coupled with its strong prime program fills out both
COAF's product offering and geographic footprint. Together, we expect to
realize significant revenue and cost synergies," said Lawson.
Under the terms of the agreement, Onyx shareholders will receive cash of
$28 per share. The $191 million aggregate purchase price represents a multiple
to book value of 2.2x and a 3.7 percent premium to Onyx's $2.8 billion in
managed receivables as of June 30, 2004. The transaction, which was approved
by the boards of directors of both companies, is subject to regulatory and
Onyx shareholder approval and is expected to close early in the first quarter
of 2005. The transaction, including the associated restructuring costs, is not
expected to have a material effect on Capital One's earnings in 2005.
The companies caution that current expectations in this release for their
earnings, synergies and strategy are forward-looking statements and actual
results could differ materially from current expectations due to a number of
factors, including competition in the auto finance and consumer lending
industries, the companies' abilities to integrate operational and strategic
platforms, and general economic conditions affecting consumer income and
spending, which may affect consumer bankruptcies, defaults, and charge-offs.
A discussion of these and other factors can be found in Capital One's and
Onyx's annual reports and other reports filed with the Securities and Exchange
Commission, including, but not limited to, Capital One's and Onyx's report on
Form 10-K for the fiscal year ended December 31, 2003.
NOTE TO INVESTORS
Onyx will file a proxy statement and other documents regarding the
proposed merger described in this press release with the Securities and
Exchange Commission. Investors and security holders are urged to read the
proxy statement when it becomes available, because it will contain important
information about Onyx and Capital One and the proposed transaction. A
definitive proxy statement will be sent to security holders of Onyx seeking
their approval of the transaction. Investors and security holders may obtain
a free copy of the definitive proxy statement (when available) and other
documents filed by Onyx and Capital One with the SEC at the SEC's web site at
http://www.sec.gov. The definitive proxy statement and other relevant
documents may also be obtained free of cost by directing a request to Onyx,
27051 Towne Centre Dr., Ste. 100, Foothill Ranch, CA 92610, attention
Investor Relations, Telephone: (949) 465-3808.
Onyx and Capital One and their respective directors and executive officers
may be deemed to be participants in the solicitation of proxies from the
shareholders of Onyx in connection with the merger. Information about Onyx
and Capital One and their respective directors and officers can be found in
Onyx's and Capital One's Proxy Statements and Annual Reports on Form 10-K
filed with the SEC. Additional information regarding the interests of those
persons may be obtained by reading the proxy statement when it becomes
About Capital One
Headquartered in McLean, Virginia, Capital One Financial Corporation
(http://www.capitalone.com) is a holding company whose principal subsidiaries,
Capital One Bank and Capital One, F.S.B., offer consumer lending products and
Capital One Auto Finance, Inc., offers automobile and other motor vehicle
financing products. Capital One's subsidiaries collectively had 46.6 million
accounts and $73.4 billion in managed loans outstanding as of June 30, 2004.
Capital One, a Fortune 500 company, is one of the largest providers of
MasterCard and Visa credit cards in the world. Capital One trades on the New
York Stock Exchange under the symbol "COF" and is included in the S&P 500
Onyx Acceptance Corporation (http://www.onyxacceptance.com) is a
specialized automobile finance company based in Foothill Ranch, California.
Onyx provides auto financing to franchised and select independent dealerships
throughout the United States.
SOURCE Capital One Financial Corporation
CONTACT: Paul Paquin, Investor Relations, +1-703-720-2456, or Tatiana
Stead, Media, +1-703-720-2352, both of Capital One; or John Hall, President
and CEO, +1-949-465-3503, or Don Duffy, CFO, +1-949-465-3505, both of Onyx
Web site: http://www.capitalone.com