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Fortress Financial Group, Inc. - Update on Acquisitions
Company Updates Stockholders on Its Acquisitions and Growth Strategy
Fortress Financial Group, Inc. (PINKSHEETS: FFGO) announced on March 17, 2008 that the Company is aggressively pursuing its stated strategy of becoming a broadly based consumer finance products group; and is at this time, in negotiations with a significant number of parties which we expect to lead to the closure of several substantial acquisitions shortly.
The company can now confirm that is in very advanced discussions with a view to acquiring a small State Chartered Bank. The rationale for this acquisition is to grow the profits of our domestic debit card program at a substantial rate as the Company would receive all of the profits from these activities, as compared to existing partnership agreements. This acquisition will allow the Company to offer credit cards to the "financially challenged" as well being in a position offer to a larger range of "private-labeled" cards to various substantial organizations within the United States. This would lead to a very aggressive roll out and promotion of branded "Fortress" domestic credit and debit cards. The Company has no plans to enter the banking sector at this stage but intends to utilize the Bank as the "Engine Room" for the Company's domestic debit card operations and facilitate the introduction of the "Fortress" Credit Cards.
Furthermore, the Company is aggressively pursuing acquisitions in the Mortgage Lending Sector, focusing on companies operating in the "financially challenged" consumer sector whose FICO scores have dropped to a level where they are unable to obtain mortgages. These acquisitions will be coupled with a planned large scale acquisition of Independent Mortgage Brokers in specifically targeted areas where synergies exist to merge these operations, reduce their overhead costs and place them in a position to negotiate more favorable commission terms. In short, the Company is utilizing its strong balance sheet to acquire companies at the "bottom of the economic cycle."
In addition to the foregoing, the Company is negotiating a "Captive Insurance License," which would enable the Company to offer Insurance services on a broad range of its existing and its future consumer finance products portfolio. This is expected to be a significant contributor to earnings over the long term.
The Company has retained the services of individuals and companies with the required high level of expertise and experience in all of the sectors in which it is now expanding.
With the ever reducing cost of borrowings, the Company is comfortable with a significant extension of its credit facilities to continue with this aggressive growth model.
The Company expects to announce several of these acquisitions shortly, as well as the appointment of a CEO of the Group's newly formed "Mortgage Division." Additional Board appointments are extremely likely, given the nature and size of certain acquisitions being contemplated at this time.
The ever rising price of Gold, recently reaching its highest ever trading level in history, has resulted in the Company's portfolio of quoted and unquoted Gold Mining interests being revalued in excess of US$1.4 billion. This has resulted in the Company's Net Asset Value per share being valued at 2.7c, compared to its current trading price of US$0.0001 per share.
The Company's stockholding in quoted Hunt Gold Corporation is valued at circa US$1 billion at its current share price. The Company conservatively valued its interests in the "Bouse" and "South Copperstone" Gold Projects at circa US$400million.
The Company is in the final stages of exchanging its stockholdings in both the "Bouse" and "South Copperstone" Gold Projects for stock in a USA-quoted Gold Mining & Exploration Company. It is expected that these transactions will be completed in the next three weeks. The Company intends to retain these shares as a portfolio investment and as collateral for substantial loans to fund acquisitions in due course.
