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Started By
Message
TD Bank calls off purchase of First Horizon Bank (IberiaBank)
Posted on 5/4/23 at 7:47 am
Posted on 5/4/23 at 7:47 am
quote:May 4, 2023
TD Bank Is Unable to Obtain Timetable for Regulatory Approvals for Reasons Unrelated to First Horizon
ORONTO and MEMPHIS, Tenn., May 4, 2023 /PRNewswire/ -- TD Bank Group (TSX andNYSE: TD) ("TD") and First Horizon Corporation (NYSE: FHN) ("First Horizon" or "the Company") today announced that they have entered into a mutual agreement to terminate their previously announced merger agreement, originally announced on February 28, 2022. TD informed First Horizon that TD does not have a timetable for regulatory approvals to be obtained for reasons unrelated to First Horizon. Because there is uncertainty as to when and if these regulatory approvals can be obtained, the parties mutually agreed to terminate the merger agreement.
Under the terms of the termination agreement, TD will make a $200 million cash payment to First Horizon. This payment is in addition to the $25 million fee reimbursement due to First Horizon pursuant to the merger agreement.
First Horizon Bank shares are down about 40% (-$6.00) this morning in pre-market trading.
This post was edited on 5/8/23 at 9:45 am
5
Posted on 5/4/23 at 8:02 am to LSURussian
I banked with Iberia, now FH. Glad this deal cratered. I had no intention of sticking around if TD took over.
Posted on 5/4/23 at 8:22 am to SloaneRanger
i bank with hancock whitney, capital one and old iberia bank now first horizon also.
why
too big? not local or regional?
hancock has been great for me as it is a regional bank for the southeast. mainly gulf coast.
quote:
I had no intention of sticking around if TD took over.
why
too big? not local or regional?
hancock has been great for me as it is a regional bank for the southeast. mainly gulf coast.
Posted on 5/4/23 at 8:25 am to Fat Bastard
quote:
why
too big? not local or regional?
Why? Why would I bank with a woke Canadian bank that shut down the accounts of the truckers protesting in Canada?
Posted on 5/4/23 at 9:12 am to SloaneRanger
It’s TD Bank (Canadian Bank) not TD Ameritrade Bank (owned by Charles Schwab).
TD Bank was eliminating all operations in Louisiana that were left from the First Horizon purchase. TD pulled out because First Horizon looks like it’s on the short list of bank failures which are next up.
Stock is down 40% today.
TD Bank was eliminating all operations in Louisiana that were left from the First Horizon purchase. TD pulled out because First Horizon looks like it’s on the short list of bank failures which are next up.
Stock is down 40% today.
Posted on 5/4/23 at 9:39 am to MrLSU
quote:
It’s TD Bank (Canadian Bank) not TD Ameritrade Bank (owned by Charles Schwab).
This. TD Bank (i.e. Toronto Dominion) is not TD Ameritrade (i.e. Charles Schwab)
@ OPPosted on 5/4/23 at 9:52 am to skewbs
Wish I had the contract to change all the bank signage every time there was a take over
Posted on 5/4/23 at 10:07 am to MrLSU
quote:
TD Bank was eliminating all operations in Louisiana that were left from the First Horizon purchase.
They were just going to shut down the branches? Not try to sell them off?
quote:
TD pulled out because First Horizon looks like it’s on the short list of bank failures which are next up.
That's not what TD said.
Posted on 5/4/23 at 10:08 am to LSURussian
quote:
Under the terms of the termination agreement, TD will make a $200 million cash payment to First Horizon. This payment is in addition to the $25 million fee reimbursement due to First Horizon pursuant to the merger agreement.
Oof. Because the government could not approve, you have to pay $225M plus all of the internal and external costs you incurred along th4e process.
Posted on 5/4/23 at 10:20 am to LSUFanHouston
It sounded to me like FH was the one that backed out because TD couldn't get regulatory approval.
Posted on 5/4/23 at 10:34 am to TDTOM
quote:
It sounded to me like FH was the one that backed out because TD couldn't get regulatory approval.
And FH still got paid? Damn.
Now... what's the reason the feds could not seem to get to an approval? Anyone know?
Posted on 5/4/23 at 11:26 am to LSUFanHouston
quote:
They were just going to shut down the branches? Not try to sell them off?
Yes and No. The legacy operations centers that Iberia had that FH kept open and a significant reduction in branch locations in Louisiana. Corporate spend in community and advertising were also going to be significantly curtailed in Louisiana.
Posted on 5/4/23 at 11:28 am to LSUFanHouston
quote:
And FH still got paid? Damn. Now... what's the reason the feds could not seem to get to an approval? Anyone know?
Anti-Trust issues from the FTC and DOJ were the two main ones. The DOJ saw a reduction in REBA for bank branches in minority communities and the FTC is pure dysfunctional.
Posted on 5/4/23 at 11:31 am to LSUFanHouston
quote:I was told by an executive at First Horizon (in Louisiana) that it wasn't the American regulators who were balking at approving the merger but it was Canadian regulators who were giving TDA Bank's home office in Toronto a difficult time.
what's the reason the feds could not seem to get to an approval?
I suspect, but I was not told this...just reading between the lines, that the Canadians might be a little worried about the banking eco-system in the U.S. these days and didn't want to see TDA Bank's Canadian parent diving into murky waters that we have nowadays in the States.
Posted on 5/4/23 at 11:38 am to MrLSU
Okay, so which is it? First you said...
And now you're saying...
quote:Then you said...
TD pulled out because First Horizon looks like it’s on the short list of bank failures which are next up.
quote:
Corporate spend in community and advertising were also going to be significantly curtailed in Louisiana.
And now you're saying...
quote:Your posts seem contradictory to me.
Anti-Trust issues from the FTC and DOJ were the two main ones.
Posted on 5/4/23 at 11:55 am to SloaneRanger
Here we go again throwing out words like "woke" where it does not apply or has any relevance to the topic at hand. 
Posted on 5/4/23 at 12:05 pm to LSURussian
quote:
Okay, so which is it? First you said...
quote:
TD pulled out because First Horizon looks like it’s on the short list of bank failures which are next up.
Then you said...
First Horizon was worth $15 billion last year. It was worth 9 billion last week. Today its worth $5 billion. The regulatory approval process takes a long time with mergers of this size and the timing was not on FH's side as the bank sector crumbled. TD was not going to pay a premium for FH. TD will probably get emergency regulatory approval for FH via the FDIC within the next 2-3 weeks. Worst case scenario is the FDIC takes FH over tomorrow if the contagion continues with FH (Friday).
quote:
Corporate spend in community and advertising were also going to be significantly curtailed in Louisiana.
Once TD Bank acquired FH this was the plan. TD Bank was going to significantly scale back FH's presence in Louisiana. FH's market concentration & focus is in Tenn, the Carolinas, and Florida. (i.e. high growth states). The remaining operational support offices that FH left in tact from the IberiaBank merger which are still located in Louisiana (i.e. not bank branches) were slated to all be relocated out of state.
And now you're saying...
quote:
Anti-Trust issues from the FTC and DOJ were the two main ones.
Your posts seem contradictory to me.
The regulatory process dragged on too long with the FTC and then the low income community groups got involved because TD was going to close a number of the under performing low income urban bank branches which impacted TD's REBA score.
Hope that helps clear it up for you.
This post was edited on 5/4/23 at 12:07 pm
Posted on 5/4/23 at 12:09 pm to LSURussian
quote:
First Horizon Bank shares are down about 40%
This is a kick in the nuts. I had Teche stock before it was Iberia and later FHN.
What is the long-term prospect for FHN? I have no need for the money today, but I'd rather move it to an index which is where i put most of my investments since I obviously don't pay attention and have no idea what I'm doing.
Posted on 5/4/23 at 12:50 pm to MrLSU
quote:
TD was not going to pay a premium for FH. TD will probably get emergency regulatory approval for FH via the FDIC within the next 2-3 weeks. Worst case scenario is the FDIC takes FH over tomorrow if the contagion continues with FH (Friday).
Is FH on the cusp of failure?
Wouldn't that be something... FH fails, TD gets it on the cheap... and basically gets their $200M back.
Posted on 5/4/23 at 1:01 pm to MrLSU
quote:The only reason FH was "worth" $15 billion last year was because the merger agreement, announced in February, 2022, called for an all cash purchase of FH's 500+ million shares at a fixed amount of $25/share which was about a 45% premium over its pre-announcement stock price.
First Horizon was worth $15 billion last year. It was worth 9 billion last week. Today its worth $5 billion.
That was what gave FH its inflated market capitalization amount.
As it became more apparent the merger might not be consummated, the $25/share purchase amount started looking iffy. So, the built in purchase premium started slipping.
You seem to think FH's market cap dropped by more than half because of its financial condition. The drop was mostly caused by the evaporation of the purchase premium magnified by the entire banking industry being out of favor by investors these days.
For example, my JPM shares have declined in price from $171/share 18 months ago to $134/share today. But I'm pretty sure JPM is not on a "short list" of banks about to fail.
quote:You're either an insider in FH or you're with a competitor. (I'm neither.) I guess we'll know within "2-3 weeks" if your information is solid or if you're spreading rumors.
TD will probably get emergency regulatory approval for FH via the FDIC within the next 2-3 weeks. Worst case scenario is the FDIC takes FH over tomorrow if the contagion continues with FH (Friday).
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