Barnett Banks Inc. has made an aggressive bid to buy Southeast Banking Corp.'s interest in Honor, the nation's third-largest retail electronic banking network.
Barnett, which already owns 7.5% of the Florida-based network, offered $1.25 million - or three times book value - for the 225,000 shares held by the bankrupt Southeast.
If successful, Jacksonville, Fla.-based Barnett would own 14.5% of Southeast Switch Inc., the company that runs Honor.
Barnett is poised to inherit another block of shares in the automated teller machine and point-of-sale network when it completes its pending acquisition of First Florida Banks.
First Florida's ownership position could not be learned, but any one member cannot hold more than 15%.
Bid Surprised Experts
Network observers noted that Southeast Switch bylaws were designed to prevent dominance by one shareholder. The network is owned by 34 financial institutions.
The aim is "to keep it democratic," said Noel Nation, Honor's general counsel and a partner at Baker & McKenzie in Miami.
Barnett "would probably have to sell some shares to a qualified financial institution."
The relatively high bid by Barnett also raised some eyebrows.
Other Bid One-Third as Much
Other potential buyers offered only book value for the Southeast Banking stake, according to Joseph J. Luzinski, an official at Development Specialists, a consultant that is managing the liquidation of Southeast Banking.
"It's a good price but not totally out of line," said Ron Dennis of Speer & Associates, a consulting firm in Atlanta. Honor, like other regional networks, is profitable but does not return "huge sums" to its owners.
Bids Still Sought
Mr. Luzinski said his company is still courting bids for the Honor shares owned by Southeast, whose banking operations were taken over last year by First Union Corp.
"Barnett has made a reasonable offer, but we are trying to solicit higher and better offers," Mr. Luzinski said,
Development Specialists will not accept additional bids below $1.4 million. Bidders must deposit $125,000 of "earnest money" by July 27.
A hearing on the sale is scheduled Aug. 4 in U.S. Bankruptcy Court for the Southern District of Florida.
1990 Merger
Southeast Switch, based in Maitland, Fla., was formed in 1990 by the merger of three regional ATM networks: Honor, Relay in North Carolina, and Avail in Georgia. All its business today is done under the Honor name.
Bank Network News, an industry newsletter, has reported that Honor handled 55.5 million transactions a month in 1991, more than all networks except California-based Star and New Jersey-based NYCE.
More than 14,400 ATMs and point-of-sale terminals in six southeastern states sport the Honor logo.
