ROCKY MOUNT, N.C., Aug. 23 /PRNewswire/ -- Centura Banks, Inc. (NYSE: CBC)
and Triangle Bancorp, Inc. (NYSE: TGL) announced today that they have reached
a definitive agreement under which Centura will acquire Raleigh, N.C.-based
Triangle in a stock transaction valued at $608.4 million, or $23.40 per
Triangle share.
Centura and Triangle will conduct a conference call today at 9:30 a.m. EDT
to discuss the transaction. The number for the conference call is
800-289-0730.
The merger will significantly expand Centura's market share in key
metropolitan areas throughout North Carolina. For example, the combined
company in the Raleigh/Durham MSA will have deposits of over $1.0 billion and
34 locations. Centura currently operates 227 locations throughout North
Carolina, Virginia and South Carolina, with total assets of $8.8 billion and
deposits of $6.0 billion. Triangle Bancorp has assets of $2.3 billion and
deposits of $1.8 billion, and operates 71 locations in Charlotte and central
and eastern North Carolina.
"Our acquisition of Triangle is a win-win situation for all our
constituencies," said Cecil W. Sewell, Centura chairman and chief executive
officer. "Triangle is an exceptionally well-run organization that will allow
us to greatly strengthen our North Carolina franchise and further leverage our
business strategy to the benefit of the customers of the combined companies.
This in turn will help us achieve our financial objectives of producing
sustained, superior financial returns for our shareholders."
Under terms of the transaction, each Triangle shareholder will receive
0.45 shares of Centura stock for each Triangle share. Based on Centura's
closing price of $52.00 on Aug. 20, 1999 the offer is approximately 3.6 times
Triangle's June 30, 1999, book value and 24.3 times trailing four quarters
earnings per share. The transaction, approved by the board of directors of
both companies, will be accounted for as a pooling of interests.
Centura expects the merger to be accretive to earnings per share in 2001.
It is estimated that pre-tax cost savings opportunities, including the
elimination of redundant operations, will total approximately $32.0 million
once the acquisition is fully integrated. The transaction is projected to be
2.4% dilutive to Centura's earnings per share in 2000. The dilution is
concentrated in the quarter of closing, before the realization of the cost
savings. Merger related charges of $50.0 million pre-tax in the quarter of
closing and an additional $10.0 million in the following quarter are
anticipated.
"We are pleased to be joining Centura," said Michael S. Patterson,
Triangle's chairman, president and chief executive officer. "As part of the
Centura organization, we will be able to offer our customers an expanded array
of financial products and services. Centura's sophisticated delivery channels
and customer information database will help us better serve the customers of
the combined organization."
Sewell added: "Our number one objective in the execution of this merger
is to have a positive impact on the customers of both companies. In most all
affected markets, Centura will be stronger, with more locations and access
options. Customer service will be our first priority and will guide all our
decisions as we move to combine the two companies."
On completion of the acquisition, which is expected to close late in the
first quarter of 2000, Mr. Patterson will assume the role of chairman of
Centura's 30-member board of directors, including 7 new directors from
Triangle. Mr. Sewell will remain chief executive officer, with headquarters
remaining in Rocky Mount. The transaction is subject to normal shareholder
and regulatory approvals.
The combined organization will strengthen Centura's North Carolina
franchise by increasing market share and leveraging the company's business
lines across an additional 80,000 households. The majority of the households
are in MSA market areas where there is proven revenue growth opportunity. As
a retailer of financial services, Centura offers a complete line of banking,
investment and insurance solutions to its customers, focusing primarily on
individuals and small businesses. Centura currently serves approximately
400,000 households in North Carolina, Virginia and South Carolina.
The acquisition allows Centura to also leverage its business strategy and
technological investments across a broader customer base. Centura is
implementing an e-commerce strategy and has developed a sophisticated customer
information database that allows the company to customize financial services
solutions to individual customer needs.
"Our customer information database has allowed us to establish a proven
track record of targeting and retaining high-value customers," Sewell noted.
"We intend to utilize this system to focus on retention of Triangle's
customers to assure the true value of the franchise is maintained.
"We also consider this a very low-risk transaction," he continued. "Both
Centura and Triangle have extensive merger integration experience, our
organizations have complementary cultures and several members of management
have worked together in the past.
"This acquisition, when fully integrated, will help Centura achieve and
sustain our financial objective of becoming a high-performance financial
services company," Sewell said. "The combination of cost savings, market
penetration and leveraged technology will provide improved financial
performance."
Centura provides a complete line of banking, investment, insurance,
leasing and asset management services to individuals and businesses in North
Carolina, South Carolina and Virginia. Centura's broad range of financial
solutions are provided through full-service financial offices and Centura
Highway, the bank's multifaceted customer access system that includes
telephone banking, an extensive ATM network, PC banking, online bill payment
and CenturaHighway.com, the bank's suite of Internet products and services.
Additional information may be found on Centura's main Web site at
http://www.Centura.com.
Triangle Bancorp is the holding company for Triangle Bank, Bank of
Mecklenburg in Charlotte, N.C., and Coastal Leasing in Greenville, N.C.
serving central and eastern North Carolina.
Safe harbor factors:
The news release contains, among other things, certain forward-looking
statements regarding each of Centura, Triangle, and the combined company
following the merger, including statements relating to cost savings, enhanced
revenues, and accretion to reported earnings that may be realized from the
merger, and certain restructuring charges expected to be incurred in
connection with the merger. Such forward-looking statements involve certain
risks and uncertainties, including a variety of factors that may cause
Centura's actual results to differ materially from the anticipated results or
other expectations expressed in such forward-looking statements. Factors that
might cause such a difference include, but are not limited to: (i) expected
cost savings from the merger may not be fully realized or realized within the
expected time frame; (ii) revenues following the merger may be lower than
expected, or deposit attrition, operating costs or customer loss and business
disruption following the merger may be greater than expected; (iii)
competitive pressures among depository and other financial institutions may
increase significantly; (iv) costs or difficulties related to the integration
of the business of Centura and Triangle may be greater than expected; (v)
changes in the interest rate environment may reduce margins; (vi) general
economic or business conditions, either nationally or in the states or regions
in which Centura does business, may be less favorable than expected, resulting
in, among other things, a deterioration in credit quality or a reduced demand
for credit; (vii) legislative or regulatory changes may adversely affect the
businesses in which Centura is engaged; and (viii) changes may occur in the
securities markets. Additional information with respect to factors that may
cause actual results to differ materially from those contemplated by such
forward-looking statements is included in Centura's current and subsequent
filings with the Securities and Exchange Commission.
SOURCE Centura Banks, Inc.
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Company News On-Call:
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800-758-5804, ext. 870954
CONTACT:
Investors, Steven Goldstein, Chief Financial
Officer, 252-454-8356, or Media, Clare Condon, 252-454-4812, both
of Centura
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