Consumer Portfolio Services’ Board of Directors Unanimously Rejects Unsolicited Indication of Interest from Auto Experience Inc.

Rhea-AI Summary

Consumer Portfolio Services, Inc. (Nasdaq: CPSS) announced its board of directors has unanimously rejected an unsolicited acquisition offer from Auto Experience Inc. (AEI), stating the proposed price of $135 million significantly undervalues the company. After thorough consideration, the board concluded that accepting AEI's proposal would not serve the best interests of CPS shareholders. Furthermore, the board expressed doubts regarding the credibility of AEI's interest, emphasizing CPS’s strong long-term prospects.

Positive

• CPS's board believes the company has strong long-term prospects.
• The rejection of the acquisition bid reflects confidence in the company's valuation.

Negative

• The board's rejection of AEI’s offer indicates potential pressure from shareholders regarding the company's value.
• Concerns raised about AEI's interest might suggest ongoing scrutiny from potential acquirers.

LAS VEGAS, Nov. 11, 2020 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) today announced that its board of directors unanimously rejected Auto Experience Inc.’s (“AEI”) unsolicited indication of interest in acquiring the Company. 

After careful review and consideration, the CPS board concluded that AEI’s indicated price of $135 million grossly undervalues the Company. Taking into account the Company’s long-term prospects, the board determined that pursuing such a transaction would not be in the best interests of the Company’s shareholders. In addition, the CPS board does not believe that AEI’s indication of interest is credible.

About Consumer Portfolio Services, Inc.

Consumer Portfolio Services, Inc. is an independent specialty finance company that provides indirect automobile financing to individuals with past credit problems, low incomes or limited credit histories. CPS purchases retail installment sales contracts primarily from franchised automobile dealerships secured by late model used vehicles and, to a lesser extent, new vehicles. CPS funds these contract purchases on a long-term basis through the securitization markets and services the loans over their entire contract terms.

Investor Relations Contact

Jeffrey P. Fritz, Chief Financial Officer
844-878-CPSS (844-878-2777)

FAQ

Why did Consumer Portfolio Services reject Auto Experience Inc.'s acquisition offer?

CPS rejected AEI's $135 million offer as it was deemed to significantly undervalue the company and not in the best interest of its shareholders.

What was the price offered by Auto Experience Inc. for Consumer Portfolio Services?

AEI offered $135 million for the acquisition of CPS.

What does CPS think about the long-term prospects of the company?

CPS's board believes the company has strong long-term prospects, which influenced their decision to reject the acquisition offer.

Did the CPS board find AEI's acquisition interest credible?

No, the CPS board expressed doubts regarding the credibility of AEI's indication of interest.