This article is more than a couple of years old.

• Share to facebook
• Share to twitter
• Share to linkedin

Mexican billionaire Ricardo Salinas Pliego is opening for business within the U.S.: their Grupo Elektra announced Monday morning its effective purchase of Advance America–the biggest lender that is payday the U.S.

Stockholders authorized the $780 million price Grupo Elektra available in February, a figure that features all outstanding stocks of this firm that is american payment associated with business’s financial obligation. You will have no immediate changes to your firm that is american operations, and CEO Patrick O’Shaugnessey has consented to stick to board, claims Elektra spokesman Daniel McCosh.

Grupo Elektra ranks 802 on our range of the entire world’s Biggest Public Companies, as well as its latest acquisition appears an all-natural complement Salinas’ profile of lucrative companies. A television station, a cell phone company, and his bank in Mexico, Salinas oversees his family-founded Elektra retail chain, which sells washers and dryers at low weekly rates plus interest, as well as a prolific motorcycle scooter plant. 10 years ago, Salinas launched Banco Azteca branches inside their Elektra stores and started offering economic solutions to Mexico’s bad. Lendees can sign up for credit to get a dishwasher, or a loan that is personal purchase medical expenses–at 50 to 60 % rates of interest.

Clearly, those rates that are high would not fly at banks in the usa. However in Mexico, they are pretty standard, when I had written within my current mag tale on Salinas’ and Elektra.

The main one place where in actuality the US regulatory system has permitted crazy interest levels is payday loan providers like Salinas’ purchase that is latest. A lot in common in fact, Advance America and Banco Azteca share. Both make use of individuals who don’t typically have lots of money, and both fee actually high interest levels.

An Advance America in-store loan of $1,000 in Mexico’s edge state of Texas, for instance, is sold with “fee” that amounts to simply about 20 per cent. The key flow from a couple of weeks following the loan is released. Business spokesman Jamie Fulmer points out that charges on tiny loans are usually less expensive when compared to a bank cost for a check that is bounced.

http://www.personalinstallmentloans.org/

Nevertheless the nagging problem comes whenever lendees have trouble repaying, states Jean Ann Fox, Director of Financial Services at the buyer Federation of America. They have stuck in a cycle of taking out fully another loan to cover back the amount that is original borrowed. The matter can snowball quickly. If lendees continue steadily to simply take more loans off to cover previous loans, they’re going to feel a squeeze: the root yearly rate of interest is 533 %.

Elektra’s latest acquisition caps off an extraordinary run-up for Salinas’ company–and his fortune. From our 2011 to 2012 Forbes Billionaires List, Salinas included $9.2 billion to their worth that is net as in Elektra skyrocketed (he has a lot more than 70 per cent). In current months, the stock dropped again while the Mexican stock market made the decision to improve Elektra’s fat on Mexico’s standard IPC index. Given that news associated with the acquisition breaks today, Salinas will probably be worth $13.9 billion.

Mexican billionaire Ricardo Salinas Pliego is starting for company when you look at the U.S.: their Grupo Elektra announced Monday morning its effective purchase of Advance America–the biggest payday lender in the U.S.

Stockholders authorized the $780 million cost Grupo Elektra available in February, a figure that features all outstanding stocks of this US company and repayment associated with the business’s financial obligation. You will see no instant modifications to your firm that is american operations, and CEO Patrick O’Shaugnessey has agreed to stick to board, states Elektra spokesman Daniel McCosh.

Grupo Elektra ranks 802 on our set of the planet’s Biggest Public Companies, and its particular acquisition that is latest appears a normal fit for Salinas’ profile of lucrative companies. In Mexico, Salinas oversees their family-founded Elektra retail string, which offers washers and dryers at low weekly rates plus interest, in addition to a prolific bike scooter plant, a television place, a cellular phone company, and their bank. 10 years ago, Salinas started Banco Azteca branches inside his Elektra stores that are retail started providing economic solutions to Mexico’s poor. Lendees can sign up for credit to get a dishwasher, or perhaps a unsecured loan to pay money for medical expenses–at 50 to 60 per cent rates of interest.