H&R Block Completes Sale of H&R Block Financial Advisors and Acquisition of Major Southwest Franchise
KANSAS CITY, MO,(MARKET WIRE via COMTEX News Network) -- H&R Block, Inc. (NYSE: HRB) today announced that it completed the sale of H&R Block Financial Advisors (HRBFA) to Ameriprise Financial, Inc. The sale transaction was previously announced August 12, 2008, and involved a purchase price of $315 million prior to adjustments. The Company received a purchase price of approximately $312 million, and total cash proceeds are approximately $360 million including repayment of inter-company liabilities. These amounts are subject to further post-closing adjustments. The company expects to record a gain of less than $10 million as a result of the transaction, subject to post-closing adjustments.
"This sale is an important step in our efforts to improve returns on invested capital, reduce risk and concentrate focus on our core tax services business," said Richard C. Breeden, Chairman of H&R Block. "We thank all our financial advisors, associates and management from HRBFA for their efforts on behalf of H&R Block, and we wish them well in the future as part of Ameriprise."
As a result of the transaction, approximately 570 management and support staff have transferred to Ameriprise along with HRBFA's 900-plus financial advisors. H&R Block acquired what is now HRBFA in 1999.
Lazard acted as financial advisor and Sullivan & Cromwell LLP acted as legal advisor for H&R Block.
Separately, H&R Block also announced that it has completed the acquisition of the operator of its franchise units in Texas, Oklahoma and Arkansas ("Block Texas"). As previously announced, the Company paid approximately $278 million in cash as part of the transaction, which results in the acquisition of 621 office locations in the Block Texas territory. Of these, 236 are operated by sub-franchisees from Block Texas who will continue to operate as franchisees under H&R Block directly. The transaction is part of Block's efforts to build on the momentum of tax season in 2008, which was the company's most successful in more than a decade, and to continue seeking to increase market share and financial performance during tax season 2009.
"We welcome aboard all the associates and tax professionals of Block Texas as we pursue the growth opportunities in this attractive market," said Russ Smyth, CEO of H&R Block.
About H&R Block
H&R Block Inc. (NYSE: HRB) is the world's preeminent tax services provider, having served more than 400 million clients since 1955 and generating annual revenues of $4.4 billion in fiscal year 2008. H&R Block provides income tax return preparation and related services and products via a nationwide network of approximately 13,000 company-owned and franchised offices and through TaxCut(R) online and software solutions. The company also provides business services through RSM McGladrey and certain consumer financial services. For more information visit our Online Press Center at www.hrblock.com.
About Ameriprise Financial
Ameriprise Financial, Inc. is a diversified financial services company serving the comprehensive financial planning needs of the mass affluent and affluent. For more information, visit ameriprise.com.
SOURCE: H & R Block