What a Combined Susquehanna and BB&T Will Look Like
BB&T announced Wednesday morning that it will acquire Susquehanna Bancshares in a $2.5 billion agreement.
BB&T Corp. (NYSE: BBT) announced Wednesday morning that it will acquire Susquehanna Bancshares Inc. (NASDAQ: SUSQ) in a $2.5 billion agreement. The deal is a cash-and-stock one in which Susquehanna shareholders will receive 0.253 shares of BB&T and $4.05 in cash for each share held. This deal would value Susquehanna at $13.75 per share, based on Tuesday’s closing price of BB&T.
Tuesday’s closing price for Susquehanna was $9.90, which would place it at a 39% premium, considering the value for it was pegged at $13.75 in the terms of this buyout. Shares of Susquehanna were trading up about 33% at $13.16 coming into the noon hour Wednesday. Susquehanna had a consensus analyst price target of $10.30 and a 52-week trading range of $9.00 to $13.24. Its total market cap is over $2 billion.
As for the costs of this acquisition, BB&T expects pretax merger and integration costs of roughly $250 million. However, the company expects that this deal will save around $160 million in annual costs going forward.
Shares of BB&T traded down 2% at $37.55 following news of the acquisition. The consensus analyst price target is $40.84, and the 52-week trading range is $32.85 to $41.04. BB&T has a market cap near $27 billion.
Susquehanna is a regional financial services holding company that claims to have approximately $18 billion in assets. It includes a commercial bank that provides financial services through more than 240 locations in the Mid-Atlantic region. The company offers investment, fiduciary, brokerage, insurance, retirement planning and private banking services. Susquehanna also operates an insurance and employee benefits company, a commercial finance company, a vehicle leasing company, a mortgage division and a settlement services company.
BB&T is one of the largest financial services holding companies in the United States, with $184.7 billion in assets. It offers a range of consumer and commercial banking, brokerage, asset management, mortgage and insurance products services.
The larger question looms: will this merger beget more bank and financial mergers?
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
