In a move that will result in creation of one of the largest community banks in the entire Midwest, Chemical Financial Corporation is acquiring Talmer Bancorp, operator of Talmer Bank & Trust based in Troy, Michigan in a cash and stock transaction valued at roughly $1.1-billion.
Boards of Directors of both Chemical Financial and Talmer Bancorp have announced the execution of a definitive agreement for the merger which will result in a community bank with approximately $16-billion in assets, $12-billion in loans and $13-billion in deposits with a combined 266 locations primarily in Michigan and Northeast Ohio. The transaction will also allow the combined company to more effectively and efficiently navigate the challenges and costs associated with becoming a larger banking institution.
David Ramaker will continue to serve as CEO & President of Chemical Financial Corporation and Chairman, CEO and President of Chemical Bank. David Provost, who serves as Talmer's President & CEO as well as Chairman of Talmer Bank, will join the Chemical board of directors. Gary Torgow, Talmer's Chairman, will serve as Chairman of the Board of the combined entity.
Under the terms of the definitive agreement, Chemical will acquire all of the outstanding shares of Talmer common stock for common stock and cash in a transaction currently valued at approximately $1.1-billion, or $15.64 per share, based on the closing price of Chemical at $29.70 per share as of January 25, 2016. Talmer shareholders will receive 0.4725 shares of Chemical common stock and $1.61 per share in cash. Subject to receipt of regulatory approvals and satisfaction of other customary closing conditions, including approval of both Chemical and Talmer shareholders, the transaction is anticipated to close in the second half of 2016.
Chemical's Ramaker said, "This is clearly a transformational merger between two healthy Michigan banks with complementary geographies. We have been impressed by what Gary Torgow, Dave Provost and the Talmer team has accomplished in a relatively short period of time, growing Talmer into one of the region's leading financial institutions." He adds, "We were even more impressed by the manner in which they did so: building a strong core banking organization with talented commercial bankers and an attractive customer base."
Ramaker also noted that through the partnership, "We will make a marked entry into the Southeast Michigan market, and expand for the first time beyond our state's borders. While Talmer's operations across Michigan clearly support our goal of being 'Michigan's Community Bank,' it's operations in Northern Ohio and other contiguous states should position us well for future growth in those markets in the years ahead."
Talmer's Torgow says, "While both Chemical and Talmer have posted strong track records of acquisitive and organic growth, ,we view this as the start of the next stage of our companies' evolutions."
After the closing, Chemical intends to consolidate Talmer Bank & Trust into Chemical Bank, and operate under the Chemical Bank name. Five members of the Talmer board of directors will join Chemical's board upon completion of the transaction, bringing the total number of Chemical board members to 12.
To demonstrate its commitment to Southeast Michigan, the combined companies announced a $4.8-million donation commitment to the Community Foundation of Southeast Michigan, Talmer/Chemical Donor Advised Fund.
Combining Chemical's 185 Michigan branches including multiple sites in Michigan's Great Southwest, with Talmer's 51 Michigan locations will result in the state's third largest branch delivery system, while the entities' combination of roughly $10.8-billion in Michigan deposits would make it the sixth largest bank, by deposits, in the state and the only one of those six actually headquartered in Michigan.
