Cadence Financial Corp. shareholders voted today to okay the transaction which will turn the Starkville-based bank over to private ownership through a Texas-based investment firm.
Community Bancorp (CBC) will acquire the company through the merger of Cadence with Maroon Acquisition Corp., a wholly-owned CBC subsidiary. Cadence will be the surviving entity.
The deal is expected to close in the first quarter of next year.
"We are pleased that the acquisition by CBC was approved by 89 percent of Cadence's voting shareholders," said Lewis F. Mallory Jr., chairman and chief executive officer of Cadence, in a statement released just before 12:20 p.m. today. "We are also excited about the opportunity to join with CBC to continue our operations under the Cadence Bank name. We believe the capital injection by CBC provides a solid value for our shareholders, employees and customers," he said.
The completion of the deal is subject to the meeting or waiver of standard closing expectations, bank officials said. It is not clear where the deal stands in the regulatory approval process.
Under the terms of the deal, Cadence shareholders will obtain $2.50 per share for their stock.
Also, the agreement calls for CBC to pay about $38 million for the U.S. Treasury's ownership of $44 million in preferred stock in Cadence. The bank agreed to participate in Treasury's Troubled Asset Relief Program in January 2009.
CBC's CEO and president Paul B. Murphy Jr. is a Mississippi State University alumnus.
Previously, he served as CEO and director of Amegy Bank, a Texas-based operation he co-founded in 1990 and helped grow from less than $100 million to more than $11 billion in assets.
Amegy â€“ which operates 85 banking centers in Houston, Dallas and San Antonio â€“Â was sold to Zions Bancorporation in 2005.
CBC officials describe the firm as being established to "acquire, stabilize and operate failed or distressed U.S. banks" and say most of CBC's investors are private and public pension funds, endowments and foundations.
At 12:10 p.m. today, shares of Cadence stock were up 1 cent to $2.46 per share.