First Horizon (FHN) Receives Fed Nod To Acquire Capital Bank
Zacks Investment Research | Oct 30, 2017 10:08PM ET
Tennessee-based First Horizon National Corporation (NYSE:FHN) received regulatory approval from the Board of Governors of the Federal Reserve System to acquire Charlotte, N.C.-based Capital Bank Financial Corp. (NASDAQ:CBF) . Per the deal, the former will acquire the latter for a total value of $2.2 billion in a stock-cash deal. The combined entity will form the fourth-largest regional bank in the Southeast.
Board members of both companies have approved the merger. However, customary approvals by regulators and shareholders of both companies are yet to be received. The transaction, which was first announced in May 2017, is anticipated to close in fourth-quarter 2017.
At the time of the announcement, Bryan Jordan, chairman and CEO of First Horizon was optimistic about the deal because the company will be able to achieve their financial targets more easily with the help of the team at Capital Bank.
As per the terms of the deal, each common shareholder of Capital Bank will get cash or stock equivalent to 1.750 of First Horizon shares and $7.90 in cash for every Capital Bank share held, subject to certain conditions. The deal has been agreed at 80% stock and 20% cash. Specifically, Capital Bank shareholders in total will own about 29% of First Horizon’s common shares and $411 million in cash.
After completion of the deal, First Horizon will continue with its First Tennessee bank brand in Tennessee, while the Capital Bank name will be used for branches outside Tennessee.
Barclays (LON:BARC) Capital Inc. and Morgan Stanley & Co (NYSE:MS). LLC acted as financial advisors for First Horizon.
The company’s reorganization efforts, which are still ongoing, are helping it to reallocate capital into the core markets. Also, its concentration on controlling costs are expected to support bottom-line growth.
The company's share price rose nearly 22.1% over the past 12 months versus the Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.