Pine Brook Partners Buys United PanAm Financial

United PanAm Financial Corp. has agreed to be acquired by buyout shop Pine Brook Road Partners and an entity controlled by United PanAm’s chairman, Guillermo Bron. Under the terms of the deal, valued at approximately $110 million, Pine Brook Road will pay $7.05 per share, which represents a 41% premium over the company’s December 27 closing price. The deal is expected to close in the first quarter of 2011. United PanAm Financial is a specialty automobile finance company.

PRESS RELEASE
United PanAm Financial Corp. (Pink Sheets:UPFC) (“UPFC”) today announced that it has signed a definitive merger agreement to be acquired by an entity controlled by Guillermo Bron, Chairman of the Board of Directors of UPFC, and by affiliates of Pine Brook Road Partners, LLC (“Pine Brook”), a private equity firm.

Under the terms of the definitive merger agreement, UPFC’s shareholders will receive $7.05 per share in cash in exchange for their UPFC shares, valuing all outstanding shares of UPFC’s common stock at approximately $110 million. The $7.05 per share price represents a 41% premium to the closing price of UPFC common stock on December 27, 2010, a 39% premium to the average daily closing price of UPFC common stock for the 30 days prior to December 27, 2010 and a 73% premium to the average daily closing price for the 12 months prior to December 27, 2010.

A Special Committee of UPFC’s Board of Directors, which consisted of a majority of the entire Board and was comprised of all of the independent directors of UPFC, unanimously approved the transaction after receiving a fairness opinion from its financial advisor, JMP Securities LLC. The transaction was also unanimously approved by UPFC’s Board of Directors (with Mr. Bron abstaining), which recommended that the shareholders of UPFC adopt the merger agreement and approve the merger.

The merger, which is anticipated to be completed in the first quarter of 2011, is subject to regulatory approvals and consents, the approval of UPFC’s shareholders (including the affirmative approval of the holders of a majority in combined voting power of the outstanding shares of common stock cast for or against the transaction which are not owned by the acquiring entity or any of its affiliates) and other customary conditions. The Board of Directors will schedule a special meeting of the shareholders of UPFC for the purpose of voting to approve the transaction. Affiliates of Mr. Bron, which own approximately 38% of the shares of common stock, have agreed to vote in favor of the transaction. In addition, the directors comprising the Special Committee of UPFC, who together own approximately 4% of the shares of common stock, have also agreed to vote their shares in favor of the transaction.

Following completion of the merger, UPFC will continue its operations, but as a privately-held company.

About United PanAm Financial Corp.
UPFC is a specialty finance company engaged in automobile finance, which includes the purchasing and servicing of automobile installment sales contracts originated by independent and franchised dealers of used automobiles. UPFC conducts its automobile finance business through its wholly-owned subsidiary, United Auto Credit Corporation.