Notable Mergers and Acquisitions of the Day 03/05: (PSTB) (KWK) (ACO) (ACI)
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Merger consideration will include: (i) $0.78 per share, or approximately $1.4 million, in cash to common stockholders for all of the outstanding common stock, and (ii) $550 per share, or approximately $5.1 million, in cash to the United States Department of the Treasury ("Treasury") for all of the outstanding Fixed Rate Cumulative Perpetual Preferred Stock, Series A (the "Series A Preferred Stock"). The purchase price for the Series A Preferred Stock represents a 45%, or $4.2 million, discount from its face value of $1,000 per share.
Upon completion of the transaction, the combined company will have approximately $2.3 billion in total assets, $1.9 billion in total deposits, $1.4 billion in total loans, and a network of 54 offices in the Carolinas, Virginia and North Georgia. The merger will strengthen Park Sterling's position as the largest community bank in the Charlotte-Concord-Gastonia MSA, which includes Rock Hill, Provident Community's home market, according to the most recently available deposit market share data, with pro forma growth from 17 to 20 branches and from $876 million to $929 million in total deposits (source: SNL Financial; June 30, 2013).
The merger agreement has been unanimously approved by the board of directors of each company. Closing of the transaction, which is expected to occur in the second quarter of 2014, is subject to customary conditions, including approval by Provident Community's common stockholders, completion of the purchase of the Series A Preferred Stock from Treasury and receipt of regulatory approval. At closing, Provident Community will merge with and into Park Sterling and, as soon as practicable following the closing, it is anticipated that Provident Community Bank, N.A. will merge with and into Park Sterling Bank.
"Our proposed merger with Provident Community advances our vision to create a regional community bank in the Carolinas and Virginia and strengthens our leading position in the attractive Charlotte metro market. Additionally, the partnership improves our branch density in South Carolina's Upstate and Midlands regions, provides an attractive source of core deposits to help fund organic loan growth, and creates efficiencies which offer an attractive financial return to shareholders," said James C. Cherry, Chief Executive Officer of Park Sterling. "Each of these outcomes is desirable individually. Together, they create a very compelling transaction. We are pleased to partner with Dwight Neese and his team at Provident Community and look forward to working together to continue serving their customers and communities."
Dwight V. Neese, President and Chief Executive Officer of Provident Community, who will remain at the combined company as a senior market executive, commented, "We are excited to enter into this partnership with Park Sterling and welcome the opportunity to help bring the combined company's strong balance sheet and broad array of products and service offerings to our customers."
Keefe, Bruyette & Woods, Inc. served as financial advisor to Park Sterling, and Sandler O'Neill + Partners, L.P. served as financial advisor to Provident Community. McGuireWoods LLP served as outside legal counsel to Park Sterling, while Kilpatrick Townsend & Stockton LLP served as outside legal counsel to Provident Community.
* Quicksilver Resources, Inc. (NYSE: KWK) announces an agreement to sell to Southwestern Energy Production Company all of their jointly owned holdings in the Sand Wash Basin for cash proceeds of $180 million to be allocated equally between Quicksilver and SWEPI LP, subject to customary due diligence and other closing conditions.
The transaction is expected to close on May 1, 2014 with an effective date of January 1, 2014.
* Arch Coal, Inc. (NYSE: ACI) announced that it has sold its Hazard subsidiary to Blackhawk Mining, LLC ("Blackhawk") for $26.3 million in cash, prior to post-closing adjustments. This sale includes the Hazard thermal coal mining complex and related infrastructure as well as approximately 38 million tons of thermal coal reserves in eastern Kentucky. As part of the sale, Arch has divested $15.6 million of reclamation liabilities to Blackhawk, and expects to be released from $43.8 million of reclamation surety bonding. In addition, Arch has the potential to receive future royalty payments of up to $35.0 million in aggregate over the next five years resulting from its retention of select coal reserves at Hazard.
"The sale of our Hazard subsidiary demonstrates that we are continuing to streamline our mining portfolio and monetize assets that are not essential to our future growth plans," said John W. Eaves, Arch's president and CEO. "This transaction allows us to further sharpen our focus on strategic assets that have the highest return potential, such as our growing Appalachian metallurgical coal franchise and our low-cost Western thermal coal platform. At the same time, the proceeds from the sale further strengthen our already substantial cash and liquidity position."
Hazard's complex includes four active surface mines: East-Mac & Nellie, Rowdy Gap, Bearville and Thunder Ridge, as well as the Teton preparation plant and Kentucky River Loading facility. In 2013, Hazard sold 1.7 million tons of thermal coal and generated $4.8 million in earnings before interest, taxes, depreciation and amortization.
* AMCOL International Corp. (NYSE: ACO) announced that its Board of Directors has unanimously approved an amended merger agreement with Imerys S.A. ("Imerys"), pursuant to which AMCOL shareholders will receive USD $45.25 per share in cash, an increase of $2.50 per share, for each share of AMCOL common stock that they own, without interest. The $45.25 per share consideration represents an approximately 31.8% premium to the volume weighted average closing price of the Company's common stock over the last 30 trading days through February 11, 2014, the day prior to the announcement of the original transaction. The transaction is valued at approximately $1.7 billion, including AMCOL's net debt.
Pursuant to the amended merger agreement, Imerys has agreed to increase its tender offer for 100% of AMCOL's outstanding shares to $45.25 per share in cash. Imerys' tender offer remains subject to customary conditions, including the tender of a majority of AMCOL's total outstanding shares of common stock and shares issuable under equity awards, and clearance from antitrust regulatory authorities. The transaction is not subject to any financing condition and is expected to close in the first half of 2014. The AMCOL Board of Directors unanimously recommends that shareholders tender their shares into Imerys' tender offer.
AMCOL further announced that today it received a revised proposed merger agreement from Minerals Technologies Inc. (NYSE: MTX) ("MTI") to acquire AMCOL for $45.00 per share in cash. The revised proposed merger agreement would provide AMCOL with the right to specifically enforce MTI's obligation to close the transaction. The revised proposed merger agreement removes provisions from MTI's previous draft agreement that made the transaction contingent on MTI's receipt of sufficient financing for the transaction pursuant to MTI's commitment letter with its lenders and that provided, in lieu of such specific enforcement remedy, for the payment by MTI of a reverse break-up fee to the Company if such financing were not obtained. Today's revised proposal did not, however, increase MTI's offer price of $45.00 per share in cash.
AMCOL also announced that its Board of Directors, after careful review and consideration with its financial and legal advisors, compared the relative merits of such further revised proposal from MTI to the increased offer reflected in the amended merger agreement with Imerys and unanimously determined that the latest Minerals Technologies proposal is not superior to the terms of the amended merger agreement with Imerys.
Ryan McKendrick, Chief Executive Officer of AMCOL, commented, "The AMCOL Board has been focused on achieving the best possible outcome for our shareholders throughout this process, and the amended merger agreement announced today further demonstrates our commitment to acting in the best interests of all shareholders."
Goldman, Sachs & Co. is serving as exclusive financial advisor to the Company and Kirkland & Ellis LLP is serving as counsel to the Company.
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Related EntitiesKeefe, Bruyette & Woods, Sandler O'Neill, Notable Mergers and Acquisitions, Earnings, Definitive Agreement
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