Damen Financial Corporation to be Acquired by MidCity Financial Corporation

Strategic Insights -

Damen Financial Corporation, a $220 million bank holding company, has announced that it will be acquired by MidCity Financial Corporation in an all-cash deal valued at $51.9 million. The acquisition is expected to close in the second quarter of 1999, pending regulatory approvals. Under the terms of the agreement, Damen stockholders will receive $18.35 per share, representing a 95% total return on investment for stockholders who invested at the company's initial public offering in September 1995. The merger is expected to provide Damen's customers with access to new and expanded services and products offered by MidCity.

Key Takeaways:

  • Damen Financial Corporation will be acquired by MidCity Financial Corporation in a cash deal valued at $51.9 million.
  • The acquisition price of $18.35 per share represents a 95% total return on investment for stockholders who invested at the company's initial public offering in September 1995.
  • The merger is expected to provide Damen's customers with access to new and expanded services and products offered by MidCity.
  • The transaction is subject to customary conditions, including the receipt of certain regulatory approvals.
  • Damen's Board of Directors unanimously approved the agreement after consulting with financial advisor Keefe, Bruyette & Woods, Inc.
  • Damen's Chairman, Mary Beth Poronsky Stull, expects that the merged company will benefit from MidCity's expertise in integrating companies into their franchise.
  • The Special Meeting of Stockholders, where stockholders will vote on the agreement, is expected to be held in the second quarter of 1999.
  • The Annual Meeting of Stockholders, originally scheduled for February 1999, has been rescheduled for March 12, 1999.

Statistics:

  • Acquisition price: $51.9 million
  • Per-share acquisition price: $18.35
  • Total return on investment for stockholders who invested at Damen's initial public offering in September 1995: 95%
  • Total return on investment (annualized): 24%
  • Damen Financial Corporation's market value: $220 million
  • Expected date of closing: Second quarter of 1999 (pending regulatory approvals)

Sources:

  • "Damen Financial Corporation to be Acquired by MidCity Financial Corporation" (PRNewswire, Feb. 23, 1999)
  • Agreement and Plan of Merger (publically filed with the SEC)
  • SEC filings are available to the public on the Internet at http://www.sec.gov