Asset Acceptance announces special cash dividend, Dutch auction in planned recapitalization

By Lisa Kerner

Charlotte, N.C., April 24 - Asset Acceptance Capital Corp. said it will recapitalize its balance sheet and return $150 million to shareholders in a plan expected to be completed by June 30.

Plans include the repurchase of up to $75 million of Asset Acceptance shares through a Dutch auction tender slated to begin in May and purchases from AAC Quad-C Investors LLC, chief executive officer Brad Bradley and chief financial officer Mark Redman, who collectively own 50.5% of the company's stock.

The balance of the $150 million return of capital to shareholders will be paid in the form of a special one-time cash dividend, according to a company news release.

Asset Acceptance will need to recapitalize its balance sheet and said it will complete a new credit facility being arranged by J.P. Morgan Securities, Inc.

The company will reveal additional details beginning in May.

"We have decided to take advantage of the current attractive debt markets and utilize our unlevered balance sheet to return capital to our shareholders and lower our cost of capital," Bradley said in the release.

"We are retaining the capital base and flexibility to continue our proven approach of purchasing charged-off consumer receivables and being opportunistic about new revenue sources that are of long-term strategic interest to us."

Asset Acceptance is a Warren, Mich.-based purchaser and collector of charged-off consumer debt.

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