Asta Completes $6.9 billion Portfolio Purchase

Debt purchaser Asta Funding (Nasdaq: ASFI) announced that it has closed on a previously announced deal where it will purchase a portfolio of consumer receivables that has a face value of $6.9 billion.

The portfolio is made up of predominantly credit card accounts and includes accounts in collection litigation and accounts as to which the sellers have been awarded judgments and other traditional charge-offs, Asta said in a press release.  Asta reported that it is paying $300 million for the portfolio, in addition to 20% of payments recovered after Asta recovers 150% of the purchase price.  Asta originally paid a $60 million deposit upon execution of the contract on February 5, 2007 and funded an additional deposit of $15 million on February 16, 2007 using its existing credit facilit. The remaining $225 million was paid in full on March 5, 2007utilizing a new credit facility with a “major financial institution.”

Asta also announced that it will hold a conference call on Friday, March 9 at 10:30am Eastern to discuss the purchase and to briefly discuss its first quarter (fiscal) results.

Gary Stern, President and Chief Executive Officer of Asta Funding, commented, "It is rare that an opportunity of this size and quality becomes available in the market. I am very pleased about the closing of this transaction as it approximately doubles the size of our assets acquired for liquidation on our balance sheet. We worked diligently to find the proper financing for this purchase and believe we selected the best funding source for our shareholders and the Company. This significant portfolio purchase not only validates our leadership in the debt buying industry, but will further demonstrate our outsourcing strategy and our ability to absorb such a large purchase without adding materially to our infrastructure. We are excited to begin servicing this portfolio and believe it will build shareholder value in the near future."

Kaulkin Ginsberg Company director Mark Russell said, “We are delighted that this transaction closed within the agreed upon timeframe, and never doubted Asta’s ability to get it done. This was a unique opportunity in the marketplace and we are grateful to our client for letting us play a role in it.”  Kaulkin Ginsberg represented the sellers of the portfolio, Great Seneca Financial Corp., in the transaction.

Kaulkin Ginsberg Company is the parent company of Kaulkin Media and insideARM.com.