Bank M&A: Let's Call the Whole Thing Off
Published February 6, 2013 10:24 AM
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Updated February 7, 2013 10:20 AM
1 Min Read
Problem assets, rival bids, unyielding regulators - these are just a few things that spell disaster in bank mergers and acquisitions. The highlights and lowlights of canceled deals in recent years. (Image: Thinkstock)
Collateral Damage
BUYER: Home DepotSELLER: EnerBank USATERMINATED: January 2008Home Depot's bid for a Utah industrial loan company fell victim to a political fight over the divide between banking and commerce triggered by Wal-Mart.Related Article: ILC Debate's New Twist: Home Depot Drops Its Bid (Image: Bloomberg News)
Searching for Stability
BUYER: CapitalSourceSELLER: TierOneTERMINATED: March 2008CapitalSource, a specialty finance company then led by John Delaney, sought more stable funding than the troubled (and later failed) TierOne could provide. CapitalSource bought an ILC that it plans to convert to a bank this year.Related Articles: CapitalSource Soldiers On with Slow Transformation Congressman-Elect Delaney Leaves CapitalSource, Named to Banking Panel
Investors' Ire
BUYER: Integra BankSELLER: Peoples Community BancorpTERMINATED: February 2008Integra CEO Mike Vea saw a chance to expand in Cincinnati on the cheap, but its investors saw a troubled target. Both banks eventually failed.Related Article: Integra Bank Tops Week's Failures as '11 Tally Hits 61
Thwarted by Writedowns
BUYER: FBOPSELLER: PFF BancorpTERMINATED: Nov. 2008FBOP's acquisition of PFF was stunted by FBOP's $1 billion in losses on Fannie Mae and Freddie Mac securities. PFF failed in 2008, and FBOP's banks failed in 2009.Related Article: Illinois' FBOP Has 9 Banks, But How Many Lives ... (Image: Thinkstock)
One for the History Books
BUYER: CitigroupSELLER: Wachovia Corp. TERMINATED: October 2008Citi agreed to buy the troubled lender with a safety net from the Federal Deposit Insurance Corp., but days later Wells Fargo said it could do the deal on its own. Wells, of course, won.Related Article: Wells to Pay $100M Settlement to Citi (Image: Bloomberg News)
Bigger is Better
BUYER: WL RossSELLER: First Bank and Trust Co. of IndiantownTERMINATED: August 2009Billionaire Wilbur Ross eyed the $88 million-asset Florida bank before joining up with other private-equity firms to buy the failed $12.8 billion-asset BankUnited in May 2009.Related Article: Ross Buying Stake in Small Florida Bank (Image: Bloomberg News)
Aid from Abroad
BUYER: Woori Finance HoldingsSELLER: Hanmi FinancialTERMINATED: June 2011Woori, a South Korean banking giant, wanted to help the then-struggling Hanmi, but regulators never approved it. A now-healthy Hanmi is for sale. Woori is a possible buyer.Related Article: Hanmi Could Spark Bidding War, Reshape Korean-American Banking (Image: Thinkstock)
Something in Common
BUYER: Metro BancorpSELLER: Republic First BancorpTERMINATED: March 2010Former Commerce Bank CEO Vernon Hill was a shareholder in both, and observers say bad blood between Hill and regulators doomed the deal.Related Article: Metro: Back to De Novo Roots in Pennsylvania (Image: Bloomberg News)
More Cash is Better
BUYER: Umpqua HoldingsSELLER: American Perspective BankTERMINATED: April 2012Umpqua agreed to pay $45 million in cash. Three weeks later, PacWest agreed to pay $58 million. American Perspective did the math.Related Article: PacWest Swoops In, Steals American Perspective from Umpqua
A Few Still Fall Through the Cracks
Cancellations slowed last year to 5% of all deals announced. Premier Service Bank, NCAL Bancorp and U.S. Century Bank were among the sellers in terminated deals.Related Article: M&A Cancellations Slow, But Still a Risk for Banks
