Yesterday it was announced that EZCORP would be increasing their stake in CCV from 33% to 53%. This would be initiated through a 91c per share offering, pending approval from 50% of the shareholders and the Supreme Court of WA.
In addition to this controlling interest, Cash Converters and EZCORP will enter into a strategic alliance to develop more financial products, building on Cash Converters’ experience as a consumer lender.
CCV and EZCORP will form a couple of JVs:
One equally owned to focus on consumer loans opportunities outside Australia, UK, and the Americas.
One owned 80% by EZCORP and 20% by CCV which will focus on consumer loans opportunities in the Americas.
Loans products will be marketed under the Cash Converters brand.
Cash Converters have been deliberately focusing on their loans business for future growth (observe the rapid takeup in the UK, where the loans business is still in the startup phase), and this new strategic alliance will focus these efforts in new markets.
As outlined in my previous article on CCV, I was awaiting an announcement from EZCORP to take over the entire company. I do not intend to sell my stake at this stage, as this strategic alliance opens huge potential in these new markets.