Franchise Services of North America Inc. announces the closing of the Merger
with Adreca Holdings Corp. and Acquisition of the Advantage Rent A Car Brand
TSX-V Trading Symbol: FSN
CALGARY, May 3, 2013 /CNW/ - FRANCHISE SERVICES OF NORTH AMERICA INC. ("FSNA"
or the "Company") (FSN.V) is pleased to announce the closing of the merger
between FSNA's wholly-owned subsidiary, Advantage Company Holdings, Inc.
("Merger Sub"), and Adreca Holdings Corp. ("Adreca), as a result of which the
Advantage Rent A Car brand is now wholly owned by FSNA.
The acquisition was consummated pursuant to a merger agreement (the "Merger
Agreement") dated July 13, 2012, among FSNA, Adreca, Boketo LLC ("Boketo") and
Merger Sub, as amended. Pursuant to the Merger Agreement, Merger Sub merged
with and into Adreca (the "Merger"), with Adreca continuing as the surviving
corporation. Following the Merger, FSNA and Adreca merged, with FSNA
continuing as the surviving corporation.
Prior to the Merger, FSNA continued/redomesticated to the State of Delaware
from Canada pursuant to a plan of arrangement approved by the Court of Queen's
Bench of Alberta on May 2, 2013 (the "Arrangement" and together with the
Merger, the "Transaction"). The Transaction was approved by resolutions of
the FSNA shareholders at a special meeting of shareholders held on April 30,
2013. The Merger and related transactions received final acceptance from the
TSX Venture Exchange today.
The Merger Agreement, together with other material agreements concerning the
Transaction, is available under FSNA's profile on SEDAR at www.sedar.com.
In connection with the Merger, FSNA issued 62,212,600 preferred shares,
US$0.001 par value per share ("Preferred Shares") to Boketo, a wholly-owned
indirect subsidiary of Macquarie Capital and the sole shareholder of Adreca,
and certain rights to acquire additional Preferred Shares upon the exercise of
outstanding options convertible into common shares of FSNA.
Commenting on the Transaction, Thomas P. McDonnell, III, the Company's Chief
Executive Officer and Chairman said, "On behalf of our over 750 team members
who have worked incredibly hard to make this Transaction happen, we would like
to thank FSNA shareholders for their ongoing support. The integration of the
Advantage Rent A Car brand into FSNA is a transformational event in our
history. This Transaction marks a significant step forward in our growth
strategy by considerably strengthening our position in the U.S. car rental
market. As the 4th largest car rental company in the U.S., we look forward
to fully capitalizing on this incredible opportunity."
FSNA is a publicly traded company listed on the TSX Venture Exchange. The
Company and its subsidiaries own the following brands: Advantage Rent A Car
("Advantage"), U-Save Car & Truck Rental®, U-Save Car Sales, Rent-A-Wreck of
Canada, PractiCar, Auto Rental Resource Center ("ARRC"), Xpress Rent A Car and
Peakstone Financial Services.
Advantage is currently positioned as a brand, and targets consumers, in the
value-oriented segment of the U.S. rental car market. As of July 2013,
Advantage is expected to operate from approximately 75 locations servicing
airports and five additional satellite locations in hotels in Hawaii and Las
Vegas and has a fleet of approximately 23,000 cars, ranging from economy cars
to SUVs. Advantage primarily services the leisure segment of the rental car
market and predominantly operates in key domestic leisure destinations,
including California, Florida, Texas, Colorado, Hawaii and Arizona.
U-Save, together with its subsidiary ARRC, has over 1,100 locations throughout
the United States and is one of North America's largest franchise car rental
companies. Having primarily serviced the local market for the past 30 years,
the Company is expanding into the airport market with plans for the opening of
airport locations in the top 30 markets in the United States and the major
airports in Canada. U-Save currently services 28 airport markets in 11
different states and 7 countries. U-Save Car Sales is an expansion of the
U-Save brand into the car sales market, and provides goods and services to car
sales operators looking to affiliate with a national brand.
Practicar Systems Inc. (a wholly owned subsidiary of FSNA) owns the rights to
the Rent-A-Wreck® and the PractiCar® trademarks for all of Canada. The
Rent-A-Wreck® system operates a network of 69 franchise locations from
coast-to-coast in Canada, providing a range of vehicle rental, leasing and
sales options to its customers. The Rent-A-Wreck® system has been in
continuous operation in Canada since 1976.
Investors are cautioned that, except as disclosed in the Management
Information Circular in respect of the Transaction, any information released
or received with respect to the Transaction may not be accurate or complete
and should not be relied upon. Trading in the securities of FSNA should be
considered highly speculative.
The TSX Venture Exchange has in no way passed upon the merits of the
transaction and has neither approved nor disapproved the contents of this
Certain statements made in this news release are forward looking in nature,
including statements made with respect to Advantage. The words "may," "could,"
"should," "would," "expect," "intend," "estimate," "anticipate," "believe," or
"outlook" and similar expressions often identify forward-looking information.
By their nature, forward-looking statements require FSNA to make assumptions
and are subject to inherent risks and uncertainties. The forward-looking
statements contained in this news release are based on certain key
expectations and assumptions made by FSNA. Although FSNA believes that the
expectations and assumptions on which the forward-looking statements are based
are reasonable, undue reliance should not be placed on the forward-looking
statements because FSNA can give no assurance that they will prove to be
correct. FSNA's forward-looking statements are qualified in their entirety by
these cautionary statements. In addition, the forward-looking statements are
made only as of the date of this news release, and except as required by
applicable law, FSNA undertakes no obligation to publicly update these
forward-looking statements to reflect new information, subsequent events or
Neither TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
on FSNA or any of its operating subsidiaries please contact:
Thomas P. McDonnell, III Franchise Services of North America Inc. (601)
SOURCE: Franchise Services of North America Inc.
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CO: Franchise Services of North America Inc.
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-0- May/03/2013 20:45 GMT
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