VICTORIA, Tex. Shareholders of FVNB Corp. will decide today whether to approve managements plan to take it private even though a nearly $160 million buyout offer is on the table.
FVNB, the $750 million-asset holding company for First Victoria National Bank, wants to buy out its shareholders with fewer than 2,000 shares.
The company would pay $16.9 million in cash to buy 375,000 shares at $45 each. This would leave fewer than 500 investors and let it delist its stock and stop reporting results to the Securities and Exchange Commission.
An alternative is the buyout offer from $1.2 billion-asset Prosperity Bancshares of Houston.
David Zalman, its president and chief executive officer, said it has long eyed FVNB as a takeover target. And in a May 7 letter to David M. Gaddis, FVNBs president and CEO, Prosperity offered 2.36 Prosperity shares for each of the roughly 2.4 million FVNB shares outstanding.
The offer worked out to about $119 million at the time, but FVNBs directors rejected it May 15.
Mr. Zalman never retracted it, however, and on July 26 he tried again. (By that time, Prosperitys rising share price had raised the value of the offer to $156.9 million.)
In a second letter to Mr. Gaddis, he promised that Prosperity would increase its annual dividend by nearly 50%, to 59 cents a share, and that after buying FVNB it would buy back 5% of its own shares at 15% premium to market price.
Nevertheless, FVNBs board rejected the offer last week, in a second unanimous vote. We intend to proceed with our plan, Mr. Gaddis said.