TD Bank Confirms $6.3B Chrysler Financial Buy |
| Wall Street Journal - Dec 21, 2010 |
Toronto-Dominion Bank (TD), Canada's second-largest bank in assets, confirmed early Tuesday it will buy Chrysler Financial Corp., the auto lender owned by Cerberus Capital Management L.P., for about $6.3 billion in cash, taking a big step toward its goal of becoming a top retail player in the U.S.
Chrysler Financial gives TD a platform for growth in the North American automotive lending market, allowing it to boost its consumer loan portfolio, TD said. The Canadian lender, the sixth-largest North American bank in assets, estimates the business could generate a return on invested capital of about 20% in three to four years.
"It's the foundation we need in the U.S.," TD Chief Executive Ed Clark said on a conference call. The acquisition "doesn't require a physical presence and local expertise" and strengthens the bank's ability to generate assets, he said.
"We needed franchises to generate assets," said Clark. "And, this is an asset class that has held up well during the cycle. We can take this platform and grow it, and grow it a lot faster than we're assuming. It will enhance our U.S. earnings."
Read Full Article from Wall Street Journal
- Posted: 2010-12-21 11:07:08
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