Jefferies Financial Group Inc. Announces Proposal to Acquire Balance of HomeFed

NEW YORK–(BUSINESS WIRE)–Jefferies Financial Group Inc. (NYSE: JEF or Jefferies), which currently
owns 70.1% of HomeFed Corporation (OTCMKTS: HOFD or HomeFed), a
developer and owner of residential and mixed-use real estate properties
primarily in California and New York, announced today that it is
proposing to acquire the remaining common stock of HomeFed not already
owned by Jefferies (the “Proposed Transaction”). The Proposed
Transaction would entail Jefferies issuing two shares of Jefferies
common stock for each share of the HomeFed’s common stock to be acquired
by Jefferies. Jefferies’ proposal will include a condition that the
Proposed Transaction will require the approval of a majority of the
outstanding shares of the HomeFed’s Common Stock not already owned by
Jefferies (or its affiliates), in addition to any other vote required by
applicable law.

The Proposed Transaction would involve the issuance of approximately
9.25 million shares of Jefferies common stock, worth approximately
$194.0 million at Friday’s closing share price. Upon completion of the
proposed transaction, Jefferies’ total post-transaction carrying value
of HomeFed’s net assets would be approximately $651.0 million,
reflecting a pre-tax gain of approximately $119 million that would
result from revaluing our 70.1% historical ownership interest when
Jefferies consolidates HomeFed.

Rich Handler and Brian Friedman, CEO and President, respectively, of
Jefferies, said “We generally would not issue shares at these prices,
but we would do so here to facilitate a strategic transaction that might
otherwise not be achievable. As a direct offset to those potentially
issued shares, Jefferies’ Board of Directors has, conditioned on the
closing of the Proposed Transaction, authorized the repurchase of 9.25
million shares in the open market. This share-repurchase approval is
incremental to the $500 million share repurchase recently approved by
Jefferies’ Board of Directors. We believe this proposed transaction
makes good sense for both Jefferies and HomeFed, as it will allow
Jefferies to consolidate HomeFed for tax purposes (which will avoid an
extra layer of taxes as HomeFed monetizes its assets), affording greater
flexibility as to the timing and form of maximizing value over time.”

Additional Information and Where to Find It

This communication relates to a proposal which Jefferies Financial Group
Inc. (“Jefferies”) has made for an acquisition of common stock of
HomeFed Corporation (“HomeFed”). In connection with this proposal,
Jefferies (and, if a negotiated transaction is agreed, HomeFed) may file
one or more registration statements, proxy statements, tender offer
statements or other documents with the SEC. This communication is not a
substitute for any proxy statement, registration statement, tender offer
statement, prospectus or other document Jefferies and/or HomeFed may
file with the SEC in connection with the proposed transaction.

Investors and security holders of Jefferies and HomeFed are urged to
read the proxy statement, registration statement, tender offer
statement, prospectus and/or other documents filed with the SEC
carefully in their entirety if and when they become available as they
will contain important information about the proposed transaction. Any
definitive proxy statement(s) or prospectus(es) (if and when available)
will be mailed to stockholders of HomeFed, as applicable. Investors and
security holders will be able to obtain free copies of these documents
(if and when available) and other documents filed with the SEC by
Jefferies or HomeFed through the website maintained by the SEC at


This communication shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be any
sale of securities in any jurisdiction in which such offer, solicitation
or sale would be unlawful prior to registration or qualification under
the securities laws of any such jurisdiction. No offering of securities
shall be made except by means of a prospectus meeting the requirements
of Section 10 of the U.S. Securities Act of 1933, as amended.

Forward-Looking Statements

This communication may “forward-looking statements” within the meaning
of the safe harbor provisions of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements include statements about our future and
statements that are not historical facts. These forward-looking
statements are usually preceded by the words “should,” “expect,”
“intend,” “may,” “will,” or similar expressions. Forward-looking
statements may contain expectations regarding the Proposed Transaction,
and may include statements of future performance, plans, and objectives.
Forward-looking statements represent only our belief regarding future
events, many of which by their nature are inherently uncertain. It is
possible that the actual results may differ, possibly materially, from
the anticipated results indicated in these forward-looking statements.
Information regarding important factors, including Risk Factors that
could cause actual results to differ, perhaps materially, from those in
our forward-looking statements is contained in reports we file with the
SEC. You should read and interpret any forward-looking statement
together with reports we file with the SEC.

About Jefferies Financial Group Inc.

Jefferies Financial Group Inc. is a diversified financial services
company engaged in investment banking and capital markets, asset
management and direct investing. Jefferies Group LLC, our largest
subsidiary, is the largest independent full-service global investment
banking firm headquartered in the U.S.


Laura Ulbrandt
(212) 460-1900

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