Monday February 9, 1:29 pm Eastern Time
First Commercial Corp. to Be Acquired by Regions Financial Corp.
FIRST COMMERCIAL CORP. (ARK.) In Pact to Be Acquired by Regions Financial Corp.
Feb. 9, 1998, Regions Financial Corp. (Nasdaq:RGBK - news) and First Commercial Corp. (Nasdaq:FCLR - news) announced that they signed a definitive agreement under which RGBK will acquire FCLR.
RGBK will exchange 1.7 shares of its common stock for each common share of FCLR. Based on RGBK's closing stock price of $40.50 on February 6, the transaction would be valued at approximately $2.7 billion and would represent an exchange value of $68.85 for each share of FCLR stock.
The acquisition, which is expected to be a tax-free reorganization for federal income tax purposes, is expected to be completed during the third quarter, pending approval by the shareholders of both companies, among other conditions. About 65,900,000 RGBK shares are expected to be issued in the transaction. The combined entity will have assets of $32.8 billion and will operate 667 banking locations in nine southern states.
The companies stated that the acquisition is expected to be ''slightly dilutive'' to RGBK's 1998 earnings per share and accretive thereafter. In connection with the transaction, RGBK expects to post a pre-tax charge of about $85,000,000 (or about $63,000,000 after tax) for the third quarter of 1998.
Additionally, FCLR granted RGBK an option to purchase, under certain circumstances, up to 19.9% of FCLR's common shares outstanding. The companies noted that FCLR has 38,790,428 common shares of outstanding, including 1,200,000 shares to be issued in connection with FCLR's pending acquistion of Federal Savings Bank of Rogers, Ark. (total assets $480,000,000), expected to be completed in March. |
