Exhibit 99
Geoffrey Eiten Peter Mullen, Director of InvestorRelations
OTC Financial Network Chancellor Corporation
877-663-0166 / 781-444-6100 ext.13 617-368-2716
geiten@otcfn.com pmullen@chancellorfleet.com
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For more information, see www.otcfn.com/chlr and www.chancellorcorp.com.
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FOR IMMEDIATE RELEASE:
CHANCELLOR ACQUIRES TOMAHAWK TRUCK & TRAILER SALES
- -- PROJECTS TRANSACTION TO ADD $50 MILLION IN REVENUES IN 1999 --
BOSTON, MA - FEBRUARY 2, 1999: Chancellor Corporation (OTC BB: CHLR) today
announced that its wholly-owned subsidiary, Chancellor Asset Management, Inc.
("CAM"), completed the acquisition of Atlanta-based Tomahawk Truck & Trailer
Sales, Inc. and all of its affiliated entities (collectively, "Tomahawk"). The
transaction provided for the purchase of 100% of Tomahawk's common stock in
exchange for 4,500,000 shares of Chancellor common stock and future cash
consideration based on Tomahawk's operating performance. Tomahawk will continue
to operate under its name as a wholly-owned subsidiary of CAM.
Tomahawk was founded in 1991 and over the past eight years has grown from a
single retail sales center to five centers and a wholesale operation throughout
the southeastern United States. Total gross revenues have grown from
approximately $500,000 in 1991 to over $40 million in 1998, representing a
compound growth rate of approximately 86%. More impressive, however, has been
Tomahawk's ability to generate an average gross margin of 15.9% throughout its
history, versus the industry average of approximately 8.6%. It is anticipated
that the acquisition will increase Chancellor's overall revenues by over $50
million in 1999.
Management believes that the Tomahawk acquisition will enable CAM to emerge as
one of the leaders in the retail and wholesale markets for used transportation
equipment. The acquisition provides CAM immediate growth in its retail sales
center network, a solid foundation for future expansion, and accelerated revenue
appreciation. CAM's current retail sales center in Elizabeth, NJ will be
complemented by the addition of Tomahawk's five retail sales centers in Atlanta,
GA; Kansas City, MO; Orlando, FL; Pompano Beach, FL; and Richmond, VA. CAM
intends to develop a nationwide retail sales center network through internal
growth and by acquisition.
Management also believes that the acquisition of Tomahawk will enable the
Company to provide value-added services to its customers for both new and used
equipment. Local, regional, and national carriers are experiencing increases in
their transit volume on account of the favorable domestic economy and the growth
in Internet commerce, which is estimated to exceed $30 billion in 1999.
Chancellor's Fleet Management Program will give its customers a choice of
quality used transportation equipment or favorable lease programs on new
transportation equipment.
Franklyn E. Churchill, president of Chancellor and CEO of CAM, remarked, "We are
pleased to have completed this transaction and welcome Tomahawk to the
Chancellor family. I am also happy to report that the founders of Tomahawk, M.
Rea Brookings and David F. Herring, will be joining the Board of Directors of
CAM. Their industry experience is a valuable asset to our management team.
"We are hopeful that the combination of Chancellor's existing fleet remarketing
business coupled with Tomahawk's wholesale and retail presence will enable
Chancellor Asset Management to provide its customers a greater level of service
with the introduction of retail equipment disposal to the fleet market, which
will result in increased shareholder value," Churchill continued. "We are very
pleased to join forces with such a well respected organization and look forward
to the challenge of driving growth."
Rea Brookings, president and co-founder of Tomahawk, remarked, "We are excited
to be joining the Chancellor team and look forward to a long and prosperous
relationship. Tomahawk has made great strides in the development,
implementation, and execution of its business plan over the past eight years. By
combining the resources of Chancellor's fleet remarketing operation with
Tomahawk's growing retail and wholesale operation, management believes the
pattern of growth can be sustained."
Chancellor Corporation is changing the equipment leasing business through
innovative financing and fleet management programs which reduce customers' total
holding costs and significantly improve fleet management through asset
management, equipment maintenance, fuel management, and data management
strategies. Since its founding in 1977, Chancellor has completed a total of
approximately $1.5 billion in equipment lease transactions for its Fortune 500
and middle market customers in the U.S. and international markets, including
South Africa and the CIS. Chancellor is a diversified international financial
services firm headquartered in Boston. The Company's Internet address is
http://www.chancellorcorp.com. The Company is publicly traded under the symbol
"CHLR."
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
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1995:
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This release contains statements that are not historical facts and that may be
deemed to contain forward-looking statements with respect to events, the
occurrence of which involves risks and uncertainties, including, without
limitation, demand and competition for the Company's lease financing services
and the products to be leased by the Company, the continued availability to the
Company of adequate financing, the ability of the Company to recover its
investment in equipment through remarketing, and other risks and uncertainties
detailed in the Company's Securities and Exchange Commission filings.