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Firstcity Financial (FCFC) To Be Bought By Varde Partners For $224.9M

 December 21, 2012 09:17 AM

(By Balaseshan) FirstCity Financial Corp. (NASDAQ: FCFC), a multi-national specialty financial services company, said it has agreed to be bought by certain funds managed by Varde Partners Inc. for $224.9 million, including debt.

Varde will pay FirstCity stockholders $10.00 per share in cash, representing a 20.5% premium to FirstCity's previous stock closing price.

FirstCity's board of directors, based on the recommendation of a Strategic Review Committee comprised entirely of independent directors, reviewed and unanimously approved the transaction and has resolved to recommend that the company's stockholders approve and adopt the merger agreement.

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In addition, each member of FirstCity's board and senior management team has entered a support agreement through which they have agreed, among other things, to vote their shares, representing 16.6% of the total outstanding shares of the company, in favor of the approval and adoption of the merger agreement.

FirstCity will retain its headquarters in Waco and will maintain its office in Dallas, Texas. Varde will not be obtaining debt financing for this transaction. The transaction is expected to close in the first half of 2013.

Varde and certain of its affiliates have worked with FirstCity since 1993 and have co-invested in a substantial majority of FirstCity's U.S. distressed asset acquisitions since 2009. Over the past several years, Varde and FirstCity have jointly invested over $800 million to purchase distressed assets with an unpaid principal balance of over $1.4 billion.

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FCFC closed Thursday's regular session up 0.36% at $8.30. The stock has been trading between $7 and $10.83 for the past 52 weeks.



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