Sovereign and Seacoast Approve Amended Terms of Agreement; Deal Becomes More Accretive to Earnings and is Equivalent to a $275 M
2004年4月13日 - 1:40AM
PRニュース・ワイアー (英語)
Sovereign and Seacoast Approve Amended Terms of Agreement; Deal
Becomes More Accretive to Earnings and is Equivalent to a $275
Million Stock Buyback BOSTON, April 12 /PRNewswire-FirstCall/ --
Sovereign Bancorp, Inc. ("Sovereign")today announced that it has
elected to amend its merger agreement with Seacoast Financial
Services Corporation ("Seacoast") to provide for a cash election as
a percentage of the overall consideration. Sovereign previously
announced its acquisition of Seacoast, a pro forma $5.3 billion
financial institution headquartered in New Bedford, Massachusetts,
on January 26, 2004 in a stock-for-stock exchange valued at
approximately $1.1 billion, or approximately $35.00 per Seacoast
share outstanding. In summary, the amended merger agreement gives
Seacoast shareholders the flexibility to elect to receive shares of
Sovereign Common Stock or cash subject to the limitation that 75%
of all the outstanding shares of Seacoast common stock are
exchanged for Sovereign common stock and 25% of the outstanding
shares of Seacoast common stock are exchanged for cash. It also
provides that each shareholder of Seacoast may receive the same
dollar value of consideration for each share of Seacoast common
stock, whether such shareholder elects to receive cash or stock.
The amendment also contains the mechanics for effecting the
cash/stock election and the equalization of the merger
consideration between Seacoast shareholders who elect to receive
cash and those who elect to receive stock. All other material terms
and conditions of the initial merger agreement remain essentially
unchanged. The amendment to the merger agreement is expected to be
filed with the SEC on Form 8-K no later than Tuesday, April 13,
2004. Commenting on the merger agreement amendment, Jay S. Sidhu,
Sovereign's Chairman and Chief Executive Officer, noted, "We are
pleased to be able to offer this flexibility to Seacoast
shareholders. As we have discussed recently, Sovereign's internal
generation of capital has become so strong that we are forecasting
over $750 million of tangible capital growth in 2005. We also
recently raised $800 million through a convertible trust preferred
issuance. All of this capital is not needed to meet our 2005
capital targets, and we have been looking at various ways to
maximize our use of this excess capital that will benefit all of
our current and prospective shareholders. We believe our stock is
meaningfully undervalued at this time and that we should take
advantage of the buy back opportunity implicit in providing fewer
shares of Sovereign common stock and more cash to Seacoast
shareholders. This also gives us the ability to give Seacoast
shareholders a choice to elect to receive cash or stock. Sovereign
is currently trading at a P/E of only 10.5 times the median of our
2005 cash earnings estimate of $1.95 - $2.05." Noted Kevin G.
Champagne, Seacoast President and Chief Executive Officer, "We are
pleased with the additional flexibility and value that Sovereign is
providing our shareholders with this change and believe that it
represents a clear win-win situation for the shareholders of our
two companies. We look forward to becoming part of Sovereign in the
third quarter, and we continue to work with Sovereign's team
members every day in order to assure a seamless transition for our
customers, employees, and communities we serve." "Sovereign remains
committed to striving to achieve approximately $1.65 - $1.70 in
operating earnings and $1.75 - $1.80 in cash earnings during 2004,
which excludes the impact of merger-related charges for our
recently completed and pending acquisitions. Sovereign also remains
committed that this merger amendment does not change any of
Sovereign's 2004 or 2005capital goals or earnings goals, or our
ability to achieve these goals. If anything, this should make our
Seacoast acquisition more accretive to earnings than the previously
contemplated all-stock structure," stated Sidhu. Sovereign Bancorp,
Inc., ("Sovereign") (NYSE:SOV), which has its New England
headquarters in Boston, Massachusetts, is the parent company of
Sovereign Bank, which is, pro forma pending acquisitions, a $55
billion financial institution with 650+ community banking offices,
over 1,200 ATMs and about 8,300 team members in Connecticut,
Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania,
and Rhode Island. In addition to full-service retail banking,
Sovereign offers a broad array of financial services and products
including business and corporate banking, cash management, capital
markets, trust and wealth management, and insurance. Sovereign is,
pro forma for pending acquisitions, one of the top 20 largest
banking institutions in the United States. For more information on
Sovereign Bank, visit http://www.sovereignbank.com/ or call
1-877-SOV-BANK. Note: This press release contains financial
information determined by methods other than in accordance with
U.S. Generally Accepted Accounting Principles ("GAAP"). Sovereign's
management uses the non-GAAP measures of Operating Earnings and
Cash Earnings, and the related per share amounts, in their analysis
of the company's performance. These measures, as used by Sovereign,
adjust net income determined in accordance with GAAP to exclude the
effects of special items, including significant gains or losses
that are unusual in nature or are associated with acquiring and
integrating businesses, and certain non-cash charges. Operating
earnings represent net income adjusted for the after-tax effects of
merger-related and integration charges and the loss on early
extinguishment of debt. Cash earnings are operating earnings
excluding the after-tax effect of amortization of intangible assets
and stock- based compensationexpense associated with stock options,
restricted stock, bonus deferral plans and ESOP awards. Since
certain of these items and their impact on Sovereign's performance
are difficult to predict, management believes presentations of
financial measures excluding the impact of these items provide
useful supplemental information in evaluating the operating results
of Sovereign's core businesses. These disclosures should not be
viewed as a substitute for net income determined in accordance with
GAAP, norare they necessarily comparable to non-GAAP performance
measures that may be presented by other companies. This press
release contains statements of Sovereign's strategies, plans, and
objectives, as well as estimates of future operating results for
2004 and beyond for Sovereign Bancorp, Inc. as well as estimates of
financial condition, operating efficiencies and revenue generation.
These statements and estimates constitute forward-looking
statements (within the meaning of the Private Securities Litigation
Reform Act of 1995), which involve significant risks and
uncertainties. Actual results may differ materially from the
results discussed in these forward-looking statements. Factors that
might cause such a difference include, but are not limited to,
general economic conditions, changes in interest rates, deposit
flows, loan demand, real estate values and competition; changes in
accounting principles, policies, or guidelines; changes in
legislation or regulation; Sovereign's ability in connection with
any acquisition to complete such acquisition and to successfully
integrate assets, liabilities, customers, systems and management
personnel Sovereign acquires into its operations and to realize
expected cost savings and revenue enhancements within expected time
frame; the possibility that expected one-time merger-related
charges are materially greater than forecasted or that final
purchase price allocations based on the fair value of acquired
assets and liabilities and related adjustments to yield and/or
amortization of the acquired assets and liabilities at any
acquisition date are materially different from those forecasted;
and other economic, competitive, governmental, regulatory, and
technological factors affecting the Company's operations,
integrations, pricing, products and services. DATASOURCE: Sovereign
Bancorp, Inc. CONTACT: FINANCIAL: Jim Hogan, +1-610-320-8496, or ,
or Mark McCollom, +1-610-208-6426, or , or Stacey Weikel,
+1-610-208-6112, or ; or MEDIA: Ed Shultz, +1-610-378-6159, or ,
all of Sovereign Bancorp Web site: http://www.sovereignbank.com/
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