$2 Billion merger of automotive lending powerhouse

Flagship Credit and CarFinance Capital Merger

November 06 2014 | Chadds Ford, PA

Perella Weinberg Partners Asset Based Value Strategy (“ABV”), a leading alternative asset management strategy and a unit of Perella Weinberg Partners, today announced that it will merge its two auto loan origination and servicing platforms, Flagship Credit Acceptance (“Flagship”) and CarFinance Capital (“CarFinance”) (together, the “combined company”), into a single, national automotive lending company. The combined company will have total assets in excess of $2 billion.

“Since forming Flagship and CarFinance, we have been pleased with the performance and strong execution of both companies,” said David Schiff, Partner at Perella Weinberg Partners and Portfolio Manager of the Asset Based Value Strategy. “Together, the two companies will create a top-tier independent auto finance company with enhanced scale, lower cost of capital, superior cost controls and more efficient access to the capital markets. Most importantly, the combination will better position these companies to provide a critical segment of the population access to credit in a first-class, fair, professional, and transparent manner. We are confident that the combined company will continue to have industry-leading standards and will achieve greater success than either Flagship or CarFinance could on a standalone basis.”

“Combining with CarFinance at this point in the companies’ growth cycles will create a leading automotive finance company with increased scale and greater flexibility,” said Michael C. Ritter, Chief Executive Officer of Flagship, who will become the Chief Executive Officer of the combined company. “Importantly, as a combined company, we will be able to better serve our dealer base through our existing brands and products and continue to provide essential financing to under-served consumers so that they can procure transportation to perform necessary daily needs. I look forward to working closely with my new partners at CarFinance and our sponsors at ABV to realize the full potential of the combined company.”

David Schiff said, “On behalf of the Board of Directors of CarFinance, I would like to thank Jim for his valuable contributions in establishing CarFinance as a leading indirect and direct lender to the auto finance industry. We partnered with two of the strongest and most accomplished management teams in the sector in Flagship and CarFinance, and we appreciate their efforts in creating two of the most successful players in the space. We look forward to working with Jim and Mike as we bring together these two complementary platforms.”

Since their inceptions, Flagship and CarFinance have each established well-recognized and accepted term asset-backed securitization programs obtaining ratings from multiple nationally recognized rating agencies. Each has also entered into bank warehouse facilities from some of the most prominent financial institutions in the world.

The combined company will be a leading, independent auto finance lender with an enhanced national presence and wide geographic diversity. On a combined basis the platforms currently originate approximately $1.2 billion of annual volume and employ approximately 600 employees. Headquartered in Chadds Ford, PA with operational offices in Irvine, CA, Phoenix, Arizona and Irving, TX, the combined company will benefit from a network of more than 7,700 automotive dealers nationwide, as well as from an active direct lending division that is helping to transform the auto financing experience.

The consummation of the merger is subject to the receipt of certain regulatory approvals and other customary closing conditions for a transaction of this type.

About Flagship Credit Acceptance

Flagship Credit Acceptance LLC ("Flagship"), headquartered in Chadds Ford, Pennsylvania with offices in Irving, Texas, Phoenix, Arizona, Irvine, California and Indianapolis, Indiana, helps credit-challenged auto shoppers secure financing through partnerships with primarily franchised auto dealers and through its direct lending site, CarFinance.com. Flagship Credit has successfully grown its portfolio to $2.9 billion in managed receivables. The Company currently purchases indirect auto contracts from a nationwide network of over 9,400 dealers and originates direct to consumers in 46 states.

About Perella Weinberg Partners

Perella Weinberg Partners Asset Based Value Strategy (ABV) is a leading post-financial crisis provider of U.S. specialty finance solutions. Since its inception in 2008, the strategy has grown to manage approximately $2.1 billion in equity capital through a number of different investment vehicles. The company delivers significant capital, technical expertise and infrastructure in a wide range of asset classes and structures, including both real and financial assets. Capital for the strategy is contributed by, among others, a diversified group of institutional investors who seek to invest in compelling opportunities.

Perella Weinberg Partners is a leading independent, client-focused financial services firm. The company provides advisory and asset management services to a broad, global client base, including corporations, institutions and governments. 

The Advisory business advises clients on mergers, acquisitions, defense advisory, financial restructuring, raising private capital, and pension matters. The Asset Management business includes a suite of hedge fund strategies, private investment funds (including real estate) and outsourced CIO solutions. Together with its affiliates, the Asset Management business has capital commitments and managed assets of approximately $11.3 billion. 

Founded in 2006 and with more than 400 employees, Perella Weinberg Partners maintains offices in New York, London, Abu Dhabi, Denver, Dubai, and San Francisco.

To learn more about the company as a whole, please visit: http://www.pwpartners.com.

Fair Lending Policy

Flagship Credit Acceptance, LLC ("Flagship") is committed to maintaining a culture of fair credit throughout the organization. In this regard, Flagship has developed a Fair Credit Program ("Program") that complies with all applicable fair credit laws and regulations ("FC Laws") and reflects industry best practices. Flagship is committed to comply with the letter and spirit of FC Laws. The goal of the Program is to carry out Flagship's commitment and be recognized internally and externally (e.g., by management, associates, customers, service providers, and the public) as dedicated to fair credit principles and demanding of compliance. The Program applies to all aspects of Flagship's operations (including reviewing, purchasing and servicing retail installment sale contracts whether for itself or others) and all services offered by Flagship, and across all of Flagship's credit operations, including marketing, underwriting, origination, processing, servicing, collection, loss mitigation, and payoff activities, and to all personnel who work for or on behalf of Flagship, whether as associates, officers, members of the Board of Directors, agents, representatives or service providers.

Should you have any questions about the details of any of Flagship's policies, please contact us at 1.800.707.0114 M-F, between 9:00 a.m. and 5:00 p.m. EST.

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Our Lending Philosophy

A borrower is more than just a credit score. At Flagship, we focus on the story behind the customer …and look beyond the number.

Life happens. Whether low credit scores are a result of past circumstances, one-time events or just bad luck, Flagship offers multi-tiered pricing structures to finance borrowers across the credit spectrum.

At Flagship we believe a borrower’s credit past shouldn’t dictate their future.

Many borrowers need a second chance. We recognize the vast majority of persons with credit challenges are working hard to re-establish their credit rating. Each of our Credit Analysts are trained in "common sense" lending, a philosophy of reviewing all the circumstances and determining the appropriate deal structure for the specific borrower situation. Flagship maintains a very high standard regarding  Fair Lending compliance, ensuring our customers are always treated professionally and consistently.

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