A Houston community bank has rejected an unsolicited offer to be acquired by Alabama's largest banking company.
CNBT Bancshares last week turned down an $82.5 million, all-cash bid by SouthTrust Corp. of Birmingham, calling the price too low.
"We thought it was an inadequate offer," said B. Ralph Williams, president and chief executive officer at $378 million-asset CNBT.
The company, parent of Citizens National Bank of Texas, responded by saying it would consider selling for $100 million, but SouthTrust rejected that proposal.
A SouthTrust official declined to confirm the bid for CNBT but said the $38 billion-asset company wants to continue building in the Lone Star state by targeting community banks in such cities as Houston, Dallas-Fort Worth, San Antonio, and Austin.
In December SouthTrust bought SecurityBank, a $90.9 million-asset institution in Arlington, between Dallas and Fort Worth, and is soon expected to close a deal for LCNB Bancorp., a $138.4 million-asset company in Houston.
"We have a high level of interest in Texas," said Butch Crouch, director of investor relations at SouthTrust. "It has super growth patterns. ... it is a logical move."
SouthTrust also bought two San Antonio insurance companies last year. Christopher M. Mustascio, a bank analyst at Legg Mason in Baltimore, said SouthTrust's offer of $16.23 a share for CNBT was just shy of his takeover- price estimate of $17 to $18. In its counterproposal, CNBT was seeking $19 to $20 a share.
Though SouthTrust's offer was less than CNBT's 52-week high of $17.12 a share, it was 35% above the company's current market price of about $11.50.
CNBT's board and other insiders own 29.51% of the company, which has six Houston-area branches. It saw 1998 earnings jump 21.3%, to $4.5 million, or 89 cents per share.