After 17 years as a publicly traded company, Peoples Bancorp in Auburn, Ind., is planning to go private.
The $469 million-asset company announced late Friday that it intends to reduce its number of shareholders to fewer than 300 so that it would no longer have to report to the Securities and Exchange Commission. It also plans to delist its stock from the Nasdaq exchange.
Peoples is the holding company for Peoples Federal Savings Bank.
In a press release, Peoples' president and chief executive officer Maurice F. Winkler 3rd, said, "Our board of directors decided to take this action because we believe that the advantages of continuing as a public company are far outweighed by the disadvantages. We believe that the cost savings we will realize by going private will have a positive impact on the corporation's results … and will allow management to focus more of its attention on the corporation's business."
Like many CEOs of banks that have opted to go private in recent years, Mr. Winkler cited the cost of complying with the Sarbanes-Oxley Act of 2002 as particularly burdensome for small banks whose shares are thinly traded. On average fewer than 1,800 Peoples shares are traded each day.
Peoples said it is to offer holders of less than 760 shares a cash payment of $16.75 per share. Shareholders will be asked to approve the split transaction at an annual meeting expected to be held in March.
In heavy trading late Monday, Peoples shares rose 5.4% from Friday's closing price, to $15.
