BancorpSouth (BXS) Closes Corporate Entity Restructuring
Zacks Investment Research | Nov 01, 2017 10:04PM ET
Recently, BancorpSouth, Inc. (NYSE:BXS) completed the merger of the company with and into BancorpSouth Bank, following which the bank continues as the surviving entity. The merger as part of corporate entity restructuring, announced in July 2017, received consent and necessary regulatory approvals from the Federal Deposit Insurance Corporation and the Mississippi Department of Banking and Consumer Finance.
Terms of the Merger
At the time of announcement in July, it was agreed that on completion of the restructuring, the outstanding shares of the bank's common stock will be cancelled. Moreover, the outstanding shares of the company's common stock will be directly converted into an equal number of shares of the bank's common stock. Therefore, the company's shareholders’ proportion of ownership in the company’s common stock, prior to restructuring, will remain same in the shares of the bank's common stock.
In addition, the same board of directors will be retained following the reorganization.
Share Repurchase Program
Following the reorganization, the previous shares repurchase program stands cancelled. Therefore, a new stock repurchase program has been announced by the board of directors of the bank.
Under the new plan, 6 million shares have been authorized to buy back with an expiration date of Dec 31, 2019.
Conclusion
The eradication of unnecessary corporate infrastructure and duplicative regulatory oversight are targeted through the reorganization which, in turn, will improve efficiency of the bank.
Also, recently BancorpSouth reported third-quarter 2017 earnings beat. Results benefited from an improvement in net interest revenues and lower expenses, partially offset by lower non-interest revenues. Given a strong balance-sheet position, the company has been steadily enhancing shareholders’ value through strategic acquisitions, dividend hikes, share buybacks and excellent expense-management initiatives.
Notably, the company's share price rose nearly 3.6% over the last six months, as compared with 1.7% growth recorded by the industry .
Currently, BancorpSouth carries a Zacks Rank #3 (Hold). You can see Original post
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