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SDN Staff Reports
Community Bancorp LLC (CBC) â€“ the investment company in a deal to buy Starkville-based Cadence Bank â€“Â has finished its drive to raise capital and now has $1 billion in equity capital.
The company announced reaching the financing milestone in a statement issued Tuesday.
The statement says the Houston, Texas-based bank holding company was set up to â€śacquire, stabilize and operate failed or distressed U.S. banks.â€ť Most of CBCâ€™s investors are private and public pension funds, endowments and foundations.
Cadence â€“Â a $1.8 billion financial company with locations in five states â€“ would be
CBCâ€™s first acquisition if Cadence shareholders and regulators approve the arrangement.
â€śWe are pleased to have attracted an exceptional group of investors who are committed to helping rebuild banks in this country,â€ť said Paul B. Murphy, Jr., CBCâ€™s CEO, in the statement.
â€śThe need for additional long-term capital in the U.S. banking system and the unique market timing enabled us to quickly bring together a talented team of directors, managers and investors who understand the role of community banks in building a strong economy. Our leadershipâ€™s extensive background in acquiring and managing financial institutions, along with $1 billion of capital commitments, firmly positions CBC to pursue a wide variety of acquisition opportunities.â€ť
Additionally, he said: â€śWe intend to pursue situations where we can partner with top local banking talent to transform distressed banks into high-performing institutions. Â We plan to provide fresh capital, new products, best in class technology and excellent management to benefit the customers we serve. The ultimate objective is to provide local customers with progressive banking services from banks with strong balance sheets.â€ť
Also, he said: â€śIn many cases, these banks have long been an asset to the people, businesses and communities they serve,â€ť Murphy remarked. â€śIn rebuilding them, CBC will position the banks to make sound loans and facilitate community growth.â€ť
Prior to CBC, Murphy â€“ a Mississippi State University alumnus â€“Â 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. Cadenceâ€™s Board of Directors approved a deal with CBC on Oct. 6, weeks after
If the deal with CBC goes forward, it will take the publicly-traded Cadence to private ownership and leave CBCâ€™s first acquisition headquartered in Starkville.
The deal will provide Cadence common stock shareholders with $2.50 a share and allow for the purchase of the U.S. Treasuryâ€™s preferred stock in the bank. The Treasury bought the stock at $44 million as part of the Troubled Asset Relief Program. CBC has offered to buy the stock at about $38 million.
Cadence shareholders will meet Dec. 9 at 10 a.m. CST to consider the CBC arrangement and decide whether to adjourn to allow for more time for proxy solicitation if sufficient votes are not gathered by meeting time.
Cadenceâ€™s stock remained unchanged at the close of trading on Tuesday at a price of $2.45 a share.