Tennessee Commerce Bancorp to Acquire Controlling Interest in Peoples State Bank of Commerce and Farmers Bank of Lynchburg
28 Julho 2011 - 7:30AM
Tennessee Commerce Bancorp, Inc. (Nasdaq:TNCC) announced today that
it intends to acquire controlling interest in two Tennessee-based
banks through a "Debt Previously Contracted" (DPC) transaction.
Upon consummation of the DPC transactions, Tennessee Commerce would
acquire ownership of over 90% of the common stock of Peoples Bank,
headquartered in Nolensville and over 90% of the common stock of
Farmers Bank of Lynchburg in a debt-to-equity exchange with the
banks' principal shareholder as well as certain other shareholders.
Through this transaction, Tennessee Commerce will be converting
non-performing debt into an investment asset, while giving the
company positive, revenue-generating options for future
consideration. The value of the shares Tennessee Commerce acquired
is estimated at approximately $30.0 million.
The DPC transactions do not require prior regulatory approval.
However, Tennessee Commerce has provided full disclosure of the
proposed transactions to the Federal Deposit Insurance Corporation,
the Tennessee Department of Financial Institutions and the Federal
Reserve Bank of Atlanta. The consummation of the transactions is
subject to receipt of appropriate consents; therefore, we can give
no assurances when or if the DPC transaction will occur, how
Tennessee Commerce Bank will ultimately dispose of the assets
acquired through DPC, or any material supervisory requirements that
may be imposed with respect to the contemplated transactions.
Tennessee Commerce is among the first banks in the southeast to
contemplate using a DPC transaction to obtain controlling interest
in other banks. Following the transaction, Tennessee Commerce may
hold the asset for up to two-years under applicable DPC provisions
and will be working with an investment banking team to evaluate its
options. During this period, the company can either sell the
banks or apply for regulatory approval to consolidate the
institutions into Tennessee Commerce Banks operations.
Ed Lowery, principal shareholder of the banks to be acquired and
chairman of Citizens Corporation, said, "These are great banks with
solid deposits, in strong communities. Citizen's Corporation has
enjoyed a good partnership with Tennessee Commerce in the past and
we are pleased that the management teams at Peoples State Bank of
Commerce and Farmers Bank of Lynchburg will remain in place and
work in collaboration with a talented and experienced executive
team at Tennessee Commerce."
Mike Sapp, Chairman and CEO of Tennessee Commerce, said, "This
transaction sets the stage for several positive long-term options.
These banks can either be enhanced and divested or can provide a
potential footprint of branches that will be strategically
advantageous to Tennessee Commerce."
The banks to be acquired have 11 branches in communities that
span southern Tennessee from east to west. Peoples State Bank of
Commerce is a $200 million bank with offices in Nolensville,
Ardmore, Dunlap, Whitwell, South Pittsburg and Jasper, Tennessee
and Grant, Alabama. Farmers Bank of Lynchburg is a $175
million institution with offices in Lynchburg, Chapel Hill,
Somerville and Oakland, Tennessee. The combined companies employ
100 people.
"This transaction will preserve jobs in the communities these
banks serve," added Sapp. "Management teams of the banks to be
acquired will remain intact and work in collaboration with our
experienced executive team. Customers of these banks will
continue to see the same familiar faces while enjoying expanded
products and services."
About Tennessee Commerce Bancorp, Inc.
Tennessee Commerce Bancorp, Inc. is the parent company of
Tennessee Commerce Bank. The Bank provides a wide range of banking
services and is primarily focused on serving the financial needs of
businesses. Its corporate and banking offices are located in
Franklin, Tennessee. Tennessee Commerce Bancorp's stock is traded
on the NASDAQ Global Market under the symbol TNCC. Additional
information concerning Tennessee Commerce Bancorp can be accessed
at www.tncommercebank.com.
More information on Peoples State Bank of Commerce and Farmers
Bank of Lynchburg are available on http://psboc.com/ and
http://www.farmersbanklynchburgtn.com/.
CONTACT: Beth Courtney
Seigenthaler Public Relations, Inc.
615-327-7999
bcourtney@seigenthaler.com
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