CHICAGO - Standard Federal Bancorp. has ended at least four years of speculation over who would acquire $1.9 billion-asset Bell Bancorp by agreeing to buy the thrift for $354 million in cash, or 1.2 times book value.
With the purchase, Standard Federal, with $13 billion in assets, enters a market dominated by such large players as First Chicago NBD Corp., ABN Amro North America, and BankAmerica Corp.
Despite the competition, Standard Federal chairman Thomas R. Ricketts said there is plenty of room for his company to snag market share and grow, primarily through the acquisition of smaller thrifts.
"With our mortgage know-how and our mortgage prowess, we can play a big part in the Chicago market," Mr. Ricketts said.
He said Bell has a good branch network - averaging $110 million in deposits per branch - that has been underutilized.
Bell, which operates as Bell Federal Savings and Loan Association, has 66,000 customers. Bell chief executive Robert G. Rowen will join the Standard Federal board and head the Chicago operation.
"Chicago is one of the few cities in the Midwest that has not had consolidation in the thrift industry," Mr. Ricketts said.
Robert Ollech of Howe Barnes Investments Inc., said Troy, Mich.-based Standard Federal has performed well in other markets, including Detroit, and could add a much-needed boost to Bell, which will retain its name to avoid confusion with another Chicago thrift, Standard Federal Bank for Savings. "Bell itself has been a mediocre performer at best," Mr. Ollech said.
There are about 30 publicly-traded small thrifts in the Chicago area that could be future acquisition targets for Standard Federal, Mr. Ollech said. The Bell deal would give Standard Federal a presence in Illinois, Indiana, Michigan and Ohio. It would also make Standard Federal the largest Midwestern thrift with a four-state franchise, the company said.
In the deal, which is expected to close during the second quarter of 1996, Bell shareholders will receive $37.50 a share. Standard Federal will also receive options to buy up to 1.8 million shares of newly issued Bell common at $33 a share.
Many analysts predicted Bell would eventually be sold when it made its first public stock offering in December 1991, but few expected Standard Federal to be the successful suitor.
"It wouldn't have been my first guess," Mr. Ollech said.
The price Standard Federal paid does appear relatively steep, but analysts said that was because of Bell's high capital ratio of 15.75%.
"Now, I suppose the focus will turn to St. Paul (Bancorp.)," another Chicago thrift expected to be taken over, Mr. Ollech said.
Mr. Ricketts noted that his bank has had opportunities to take over smaller thrifts in the Chicago area in the past, but he said the deals never seemed attractive.
"We have been looking for the right opportunity to enter the Chicago market," Mr. Ricketts said.