Banking M&A's 10 Richest Deals
February 17, 2016 7:30 AM
Banks are generally selling for less than they did before the financial crisis. Yet there have been select instances in which buyers have been willing to pay significant premiums to sellers' tangible book values. Here are highest premiums since January 2015 for deals valued at $100 million or more.
BOK Financial-MBT Bancshares
BOK Financial in Tulsa, Okla., showed a willingness to expand in spite of the toll that low oil prices have taken on its loan book. BOK, led by Chief Executive Steven Bradshaw, agreed in December to buy MBT Bancshares in Kansas City, Mo., for $103 million in cash an eye-popping 347% premium for the $584 million-asset MBT.
PacWest-Square 1
PacWest CEO Matt Wagner was in need of low-cost funding, and he was willing to spend for it . The Los Angeles company paid $847 million in stock last year for Square 1 in a deal that valued the North Carolina tech lender at 263% of its tangible book value.
Royal Bank of Canada-City National
The biggest deal of 2015 by face value also involved one of the highest premiums. Royal Bank of Canada's $5.3 billion purchase of City National in Los Angeles translated to a 262% premium. City National CEO Russell Goldsmith and his family pocketed an estimated $700 million from the sale.
Pinnacle Financial-CapitalMark Bank
Pinnacle in Nashville, Tenn., has two deals on this list, serving as evidence of how important acquisitions in Tennessee are to CEO Terry Turner. Pinnacle agreed to pay $187 million in cash and stock for the $968 million-asset CapitalMark. The deal valued the Chattanooga, Tenn., company at 243% of its tangible book value.
BBCN Bancorp-Wilshire Bancorp
Kevin Kim, CEO of BBCN in Los Angeles, was eager to solidify his company's position as the nation's biggest Korean-American bank . The $1 billion deal, which values Wilshire at 224% of its tangible book value, was recently criticized by two former BBCN directors.
Western Alliance-Bridge Capital
Bridge Capital in San Jose, Calif., like Square 1 Financial on this list, was a big technology lender. That may have spurred Western Alliance CEO Robert Sarver to pay $424 million or a 222% premium for the $1.8 billion-asset Bridge.
Pinnacle Financial-Avenue Financial
Pinnacle, after announcing deals in Chattanooga and Memphis , opted to go big in Nashville by agreeing last month to buy Avenue for $209 million . Avenue CEO Ron Samuels negotiated a 221% premium.
Chemical Financial-Lake Michigan Financial
Chemical in Midland, Mich., sought to bulk up in its home state by paying $188 million for Lake Michigan Financial in a deal that valued the seller at 221% of its tangible book value. Chemical CEO David Ramaker was stingier in a follow-up deal, agreeing last month to buy Talmer Bancorp for a 150% premium a figure which does not make this list.
BB&T-National Penn Bancshares
Kelly King, BB&T's CEO, was expected to make more acquisitions in Pennsylvania after buying Susquehanna Bancshares. He wasted little time , agreeing in August to buy National Penn in Boyertown, Pa., for $1.8 billion, or 219% of the seller's tangible book value.
MB Financial-American Chartered
The privately held American Chartered was one of the last remaining banks with scale around Chicago. That was enough to persuade Mitchell Feiger, MB Financial's CEO, to pay nearly $450 million , or a 219% premium for the $2.8 billion-asset American Chartered.
