TD Bank nixes First Horizon merger citing regulatory approval delays
Canada’s Toronto-Dominion Bank (TD Bank) and US-based First Horizon have nixed a proposed $13.4 billion merger citing delays obtaining the necessary approvals from regulators.
First Horizon and TD Bank mutually terminate merger
The firms say TD Bank has been “unable to obtain [a] timetable for regulatory approvals for reasons unrelated to First Horizon”.
As such, the merger, originally announced on 28 February 2022, has been mutually terminated and TD Bank has agreed to fork out $200 million in cash to First Horizon.
That payment is on top of a $25 million fee reimbursement due to First Horizon under the terms of the mooted merger.
The deal would have seen TD Bank purchase First Horizon in an all-cash transaction worth $13.4 billion, or $25 for each First Horizon share. When the merger was first announced, TD Bank CEO Bharat Masrani said at the time that the move would have provided the firm with “immediate presence and scale in highly attractive adjacent markets in the US with significant opportunity for future growth across the Southeast”.
The shares of First Horizon Series G Preferred Stock that TD Bank purchased will continue to reflect a conversion price of $25 per share.
First Horizon chair, president and CEO Bryan Jordan says that while the decision is “unfortunate and unexpected”, the firm still has a “strong capital position, disciplined credit quality, expense control measures and well-diversified and stable funding”.
On the collapse of the deal, Masrani says: “This decision provides our colleagues and shareholders with clarity. Though disappointed with the outcome, we move forward with a strong, growing franchise in the United States.”
