Element to Acquire GE Capital's Fleet Operations in the United States & Mexico and Australia & New Zealand for C$8.6 Billion

Sale of GE Capital's European Fleet Operations to Arval Strengthens the Element-Arval Global Alliance

-- Expected ~20% accretion to annual EPS based on fully annualized synergies in the range of US$ 90 million to US$ 95 million

--Related Arval transaction expands and strengthens the Element-Arval Global Alliance in Europe

--Senior credit line increased from US$2.0 billion to US$8.5 billion and extended for a three-year term

--Element's total assets to increase to C$21 billion


TORONTO, ONTARIO--(Marketwired - June 29, 2015) - Element Financial Corporation (TSX:EFN) ("Element" or the "Company"), one of North America's leading fleet management and equipment finance companies, announced today that it has entered into a definitive agreement with GE (NYSE:GE) to acquire GE Capital's remaining North American fleet management operations in the US and Mexico, as well as GE Capital's fleet management operations in Australia and New Zealand (the "Transaction) for an all-cash purchase price of C$8.6 billion. Element had previously acquired the Canadian operations of GE Capital's North American fleet management business in June of 2013.

"Adding these very high quality businesses to our existing fleet operations firmly establishes Element as a leader in the North American fleet management industry," said Steven Hudson, Element's Chief Executive Officer. "But more importantly, by combining these businesses we're being given an unprecedented opportunity to bring together the systems, technologies, products and people that have helped to define excellence in the fleet management industry in North America for more than five decades," added Mr. Hudson.

Transaction Details

In addition to the purchase of net earning assets in the U.S., Mexico, Australia and New Zealand, the Transaction includes the transfer of the employees, systems, offices, agreements, intellectual property and other assets required to operate the acquired fleet management businesses in these jurisdictions.

In a related transaction, Element confirmed today that Paris-based Arval, a wholly-owned subsidiary of BNP Paribas and Element's founding partner in the Element-Arval Global Alliance, has entered into a memorandum of understanding to acquire GE Capital's European fleet operations. Element facilitated GE in structuring the transaction with Arval. Together, these two transactions signal a new level of collaboration between Element and Arval in serving the global fleet management needs of international customers. On closing of the two transactions, the Element-Arval Global Alliance will be capable of managing customer fleets in more than 40 countries.

The North American-based portion of the GE portfolio represents C$5.3 billion of the net earning assets acquired by Element while the Australia and New Zealand-based portions represents C$1.8 billion. Through its expanded alliance with Arval, and now its direct ownership of fleet operations in Mexico, Australia and New Zealand, these transactions provide Element with greater capacity to support international customers with integrated global fleet management solutions.

"We see the opportunity to expand our fleet management operations into Australia and New Zealand as an excellent fit with our established North American operations," said Bradley Nullmeyer, Element's President. "In addition to strengthening our ability to support international fleet customers through these transactions, we believe the economic scale of Element's expanded fleet management enterprise will enable us to accelerate the development and deployment of the next generation of advanced fleet analytics and data benchmarking tools. These expanded and enhanced service offerings will further differentiate Element Fleet Management in the market and deliver incremental cost savings for our fleet customers," added Mr. Nullmeyer.

A transition services agreement between Element and GE under which GE will provide various services during the transition period, ensures that services to customers, suppliers and employees will not be disrupted following the closing of the Transaction.

Financial Highlights

The purchase price represents a premium over the acquired net earning assets of C$7.3 billion that is consistent with Element's previous fleet management acquisitions. The Transaction constitutes an "Eligible Transaction" under the terms of the outstanding subscription receipts and extendible convertible unsecured subordinated debentures issued by Element on May 29, 2015. The Transaction will be funded from the C$2.7 billion net proceeds of the offering of subscription receipts, subordinated convertible debentures and preferred shares that the Company closed on May 29, 2015 together with C$5.9 billion in debt financing underwritten by a syndicate of Canadian and international banks through a committed increase of the Company's senior credit facility to US$8.5 billion which will be concurrently extended for a three-year term from the date of closing. Element's tangible leverage ratio following the closing of the Transaction is expected to increase to approximately 4.3:1 computed on the basis of the Company's bank covenant, and to approximately 5.3:1 according to market convention.

Integration plans will be finalized prior to closing to align the fleet management operations of the two companies with the objective of optimizing the customer experience through enhanced product offerings and state of the art technology. Significant savings are expected to be realized from revenue synergies, expense reductions and cost of funds improvements. As a result, the Transaction will result in 20 percent accretion to annual EPS based on fully annualized synergies in the range of US$90 million to US$95 million.

"While the continued consolidation of the North American industry will present further opportunities for the Company, management's focus and discipline will be on delivering value to our shareholders and customers through the integration of these acquired GE fleet operations," noted Mr. Hudson.

The Transaction is subject to regulatory and other approvals. The U.S. & Mexico transaction is expected to close in the third quarter of 2015, and the Australia & New Zealand transaction in the fourth quarter of 2015 subject to the receipt of these approvals. The closing of the Transaction is independent of the conclusion of GE's memorandum of understanding with Arval.

On closing of the Transaction, Element's combined fleet management operations will include more than one million vehicles under contract and net earning fleet assets of more than C$13 billion. The Company's total assets will exceed C$21 billion.

Transaction Advisors

BMO Capital Markets, Barclays, INFOR Financial Inc. and CIBC acted as financial advisors to Element in connection with the Transaction, including the structuring of the transaction between GE and BNP Paribas. Blake, Cassels and Graydon and Cravath, Swaine and Moore acted as legal counsel to Element.

About Element Financial Corporation

With total assets of approximately C$21 billion after giving effect to the current transaction, Element Financial Corporation is one of North America's leading fleet management and equipment finance companies. Element operates across North America in four verticals of the equipment finance market - Fleet Management, Commercial & Vendor Finance, Rail Finance and Aviation Finance.

Conference Call:

A conference call to discuss the Transaction with analysts will be held on Monday June 29, 2015 at 8:30 a.m. ET. The conference call can be accessed by dialing the following numbers:

North America Toll-Free: 1-866-696-5910 passcode 1758145
Local: 416-340-2217 passcode 1758145
International: https://www.confsolutions.ca/ILT?oss=7P1R8666965910

A series of presentation slides will be referenced by management during the conference call. These slides will be available on the Company's website in advance of the conference call and may be accessed at http://www.elementcorp.com/investors/presentations-1.

The conference call will be recorded and can be accessed until July 29, 2015 by dialing 1-800-408-3053 or 905-694-9451 and entering the pass code 6007314.

Forward Looking Statements

This release includes forward-looking statements regarding Element and its business. Such statements are based on the current expectations and views of future events of Element's management. In some cases the forward-looking statements can be identified by words or phrases such as "may", "will", "expect", "plan", "anticipate", "intend", "potential", "estimate", "believe" or the negative of these terms, or other similar expressions intended to identify forward-looking statements. Forward-looking statements in this release include those related to the closing, subsequent integration and financial impact of the acquisition of various fleet management businesses from GE. The forward-looking events and circumstances discussed in this release may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting Element, including risks regarding the equipment finance industry, economic factors and many other factors beyond the control of Element. No forward-looking statement can be guaranteed. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statement or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Element undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

Contact Information:

Investors:
Element Financial Corporation
John Sadler
Senior Vice President
(416) 386-1067 ext. 2313
jsadler@elementcorp.com

Media:
Longview Communications
(416) 386-1067 ext. 2233
media@elementcorp.com