During the second quarter of fiscal 2003, which ends Dec. 31,ACE Cash Express will record a pre-tax gain of about $900,000 fromthe deal. However, the gain will be largely offset by costsassociated with discontinuing the GNB loan product. The companyexpects to complete this by the end of the quarter.

ACE Cash Express plans to use proceeds from the sale to openstores in other markets, to reduce term indebtedness to banklenders, and for general working capital purposes. "We believe thatthis particular sale makes sense for both companies and is a goodeconomic deal for ACE, as 14 of the 19 stores were well below ourexpected profitability per store and therefore did not meet ourreturn expectations," says Jay B. Shipowitz, the company'spresident and chief operating officer.

ACE Cash Express, based in Irving, TX, is a large check-cashingchain and provider of related retail financial services.