A Delaware court has blocked the proposed sale of BankAtlantic to BB&T Corp.
The Delaware Court of Chancery had been asked to intervene by a group of investors in BankAtlantic Bancorp's trust preferred securities, led by Hildene Capital. The investors had objected to the terms of the sale, which would have left them holding a stake in a reinvented BankAtlantic. BB&T, based in Winston-Salem, N.C., agreed last fall to essentially buy the deposits and the performing assets of BankAtlantic's thrift unit. The investors argued that BB&T should have also agreed to have taken on the company's debt.
Alan Levan, BankAtlantic's chairman, president and chief executive, indicated in a press released late Monday that the ruling had essentially killed the original deal with BB&T. "We are obviously disappointed as this ruling prevents the transaction from going forward as currently structured," Levan said. "BankAtlantic will continue to operate in its normal course while we consider our options. … This order is an obvious setback to a transaction we believed and continue to believe to be in everyone's best interests."
At the time that the sale was announced, Levan had touted the deal as an "elegant solution" for his company, which had planned to reinvent itself as a specialty finance business. Levan had testified during court proceedings that his company would likely be "out of business" within two years if the thrift unit's sale was blocked. BankAtlantic stoked concerns that the deal could fall through by announcing in earlier this month that it could pursue a rights offering if the BB&T was delayed past its planned early April closing.
"We are very disappointed that the ruling is not in favor of BankAtlantic," said David White, a BB&T spokesman. "We hope BankAtlantic can reach a resolution with their investors."