SOURCE: The First Marblehead Corporation

June 26, 2008 16:02 ET

First Marblehead Provides Update on Status of Equity Investment by Affiliates of GS Capital Partners

BOSTON, MA--(Marketwire - June 26, 2008) - On December 21, 2007, The First Marblehead Corporation (NYSE: FMD) announced an investment agreement with affiliates of GS Capital Partners ("GSCP") under which they invested $59.8 million to acquire shares of the Company's convertible preferred stock, all of which were converted into 5.3 million shares of First Marblehead common stock. The Company and GSCP anticipated a second step of the investment would be completed by the end of the Company's fiscal year, subject to receipt of applicable regulatory approvals and determinations and satisfaction of other conditions.

First Marblehead has been informed by GSCP that it has not yet received all applicable regulatory approvals and determinations necessary to complete the investment. These approvals and determinations are still pending, and GSCP is continuing to work to obtain such approvals and determinations. The investment is expected to close in the Company's fiscal quarter ending September 30, 2008, after completion of the Company's financial statements for the fiscal year ending June 30, 2008.

About The First Marblehead Corporation -- First Marblehead provides financial solutions that help students achieve their dreams. The Company helps meet the growing demand for private education loans by providing national and regional financial institutions and educational institutions, as well as businesses and other enterprises, with an integrated suite of design, implementation and securitization services for student loan programs. First Marblehead supports responsible lending for borrowers and is a strong proponent of the smart borrowing principle, which encourages students to access scholarships, grants and federally guaranteed loans before considering private education loans. For more information, go to www.firstmarblehead.com.

About Goldman Sachs & GS Capital Partners -- Founded in 1869, Goldman, Sachs & Co. is one of the oldest and largest investment banking firms. Goldman Sachs is also a global leader in private corporate equity and mezzanine investing. Established in 1992, the GS Capital Partners Funds are part of the firm's Principal Investment Area in the Merchant Banking Division. Goldman Sachs' Principal Investment Area has formed 13 investment vehicles aggregating $56 billion of capital raised. GS Capital Partners VI is the current primary investment vehicle for Goldman Sachs to make large, privately negotiated equity investments.

Statements in this press release, including expectations concerning the timing of the closing of the equity investment by GS Capital Partners as well as any other statements that are not purely historical, constitute forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on the Company's plans and expectations as of June 26, 2008. The inclusion of this forward-looking information should not be regarded as a representation by First Marblehead or any other person that the plans or expectations contemplated by the Company will be achieved. You are cautioned that matters subject to forward-looking statements involve known and unknown risks and uncertainties, including regulatory and other factors, which may cause the timing of events to be materially different than those expressed or implied by forward-looking statements. Important factors that could cause or contribute to such differences include: receipt and timing of required regulatory approvals, satisfaction of other closing conditions and the other factors set forth under the caption "Item 1A. Risk Factors" in First Marblehead's quarterly report on Form 10-Q filed with the Securities and Exchange Commission on May 12, 2008. First Marblehead disclaims any obligation to update any forward-looking statements as a result of developments occurring after the date of this press release.

Contact Information

  • Contact:

    Janice D. Walker
    Vice President
    Corporate Communications
    617-638-2047

    Lee Jacobson
    Vice President
    Investor Relations
    617-638-2065