By Paul Sims
Early next week, Cadence Bank officials are expected to discuss the bank’s future and the transaction which takes the bank from publicly-traded status to private hands.
Late last week, bank officials scheduled a Monday press conference to outline Cadence’s sale to Community Bancorp – known as CBC. This is a Texas-based company set up to acquire, stabilize and run failed or distressed U.S. banks. Officials have said the formal transaction was scheduled to take place Friday.
The proposal called for Cadence common shareholders to receive $2.50 per share and for CBC to pay about $38 million for the $44 million in preferred stock Cadence provided to the U.S. Treasury as part of the Troubled Asset Relief Program.
Cadence is a $1.6 billion financial services company – headquartered in Starkville – with operations in Tennessee, Alabama, Florida, Georgia and Mississippi. In November, CBC obtained $1 billion in capital to invest in banking institutions. Most of CBC’s investors include endowments, foundations and public and private pension funds.
Officials have said CBC will infuse Cadence with an estimated $150 to $200 million in capital.
The deal emerged into the spotlight in October, when Cadence officials decided to withdraw from a previous merger agreement with in-state banking entity Trustmark in favor of this new arrangement.
Most of Cadence’s shareholders voted to support the transaction in December on an 89 percent affirmative vote.
In mid-February, the Federal Reserve approved the transaction.
In a February statement about the Fed approval, Cadence officials said the bank “will be the surviving corporation in the merger transaction, with its identity, character and personnel” intact.
When the CBC sale was first announced, Cadence Chairman and CEO Lewis F. Mallory Jr. said jobs would be retained throughout the bank. “ ... I think you’ll find that Cadence will maintain the same community commitments, the same feeling of community that it’s built up over these many, many years. That will be unchanged, and it will be backed by a significant amount of capital to add to our ability to do those kind of things,” he said.
Also last month, Mallory announced he’ll retire after the sale to CBC is done.
He first joined National Bank of Commerce – which became Cadence Bank in recent years – upon graduation from Mississippi State University in 1965.
He first became its president in 1974, then took over as CEO in 1978.
He assumed the chairmanship, retaining the CEO title, in 1993.
Cadence President Mark Abernathy will take over as CEO, and CBC President Paul Murphy – also an MSU alumnus – will assume the role of Cadence’s chairman.
Murphy was previously CEO of Texas’ Amegy Bank – which he built into an $11 billion company and recently sold to Zions Bancorporation in Salt Lake City, Utah.
The Cadence deal is expected to be CBC’s first acquisition.