Published: Sat, February 09, 2019
Markets | By Otis Pena

BB&T, SunTrust announce merger

BB&T, SunTrust announce merger

The long-anticipated boom in bank mergers and acquisitions may finally be arriving. "To me, this should be looked at as very positive news not only for Whiteville, but Columbus County, southeastern North Carolina and the state of North Carolina".

The deal pays SunTrust shareholders 1.295 BB&T shares for each SunTrust share they own, according to a joint statement released Thursday morning.

The bank created by the merger will get a new name, which has not been announced, and a new headquarters in Charlotte.

Combined, the company will become the sixth largest United States bank, based on assets and deposits.

BB&T and SunTrust have about 740 branches within two miles of each other, or about 24 percent of all branch locations run by the banks. Even though BB&T shareholders will end up with a majority of shares, a key point for SunTrust was that the deal would treat the banks as equals. BB&T shareholders will own about 57% of the combined company. The combined company will keep a presence in Winston-Salem.

The 100,000-square-foot building slated for the intersection of J.K. Powell Blvd. and Columbus Street will house the 500 BB&T employees who now work in nine locations in the Whiteville area, including its Client Care Center on US 701 North. And Ernst & Young said it expects a flurry of transactions this year, fueled by easing regulations and the USA tax overhaul, which helped lenders build a war chest to spend on acquiring new clients and technology.

The two banks' market share will make them a formidable presence in the South, particularly in growing cities like Atlanta and Nashville, Tenn., analysts speculate.

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RBC and Wachtell, Lipton, Rosen & Katz advised BB&T while Goldman Sachs along with the investment banking unit of SunTrust and Sullivan & Cromwell advised SunTrust.

The company changed its name in 1913 to Branch Banking and Trust Company, or BB&T.

"This is a true merger of equals, combining the best of both companies to create the premier financial institution of the future", said BB&T Chairman and Chief Executive Officer Kelly S. King. Both banks have large offices in downtown Lakeland, just two blocks apart between Florida and Tennessee avenues. Brian Moynihan, chief executive officer of Bank of America Corp., said last month he could envision the creation of another megabank, given the large number of small players spread throughout the country.

Each company will appoint half the seats on the board of directors.

The new company will be lead with BB&T Chairman and Chief Executive Officer Kelly S. King as the new company's Chairman and Chief Executive Office until September 12, 2021. He will then become CEO for six months, after which he'll add board chairman to his title.

SunTrust shareholders will receive a 5% increase in their dividend upon consummation of the transaction based upon each Company's current dividend per share.

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