Two of the largest banks in the Midwest merge.
DCF Financial Corporation, based in Detroit, will be acquired by Huntington Bankshire Inc. from Columbus, Ohio, in an all-share deal that will form a consolidated company with approximately $ 168 billion in assets, as well as the US Federal Reserve’s list of the top 20 largest banks. Country in terms of total assets.
Executives with the two banks say the $ 22 billion deal expires in the second quarter of 2021. The integrated holding company and bank will operate under the Huntington name and brand.
According to DCF, the largest bank headquartered in Michigan, the deal with Huntington comes four months after the company formally completed the acquisition of Chemical Bank.
While the consortium is legally settling in Ohio, executives at both banks say they have reached a “win-win” agreement allowing dual headquarters in Detroit and Columbus.
DCF Bank’s new headquarters building under construction in the city of Detroit is scheduled to open in mid – 2022, and will be filled with at least 800 employees under a consolidated plan, as opposed to leasing parts of it to other companies, as previously planned. Called.
In addition, Detroit’s newly renamed DCF Center will be relocated to the Huntington Center, the same name as an arena in Columbus. In February 2019, DCF paid $ 33 million over 22 years for the naming rights of the Detroit Convention Center.
“We started this with the intention that it should be a win-win, or that it was not worth doing. It’s not a blink of an eye,” said Stephen Steiner, Huntington’s CEO and CEO. Call with reporters on Sunday evening. “This is a significant commitment to Detroit and Michigan. We have been making Michigan investments now … for 10 years.”
Under the agreement announced Sunday night by Steinor and DCF Bank President Gary Torgo, Detroit will be the headquarters of the Commercial Bank and the Columbus Consolidated Banks’ consumer business hub.
Under the terms of the agreement, Torgo will serve as chairman of the board of directors of the consolidated banks, and Steiner will retain his position as chairman, chairman of the holding company and CEO.
“We will be a great regional bank with a competitive size and passion for service,” Torgo said. “Linking to the Huntington site will be of great benefit to our partners, our partners, and of course our customers and our communities.”
Bank M&A has been slow this year compared to other recent years, but as Crane reported earlier on Sunday, it is expected to increase.
According to US Federal Deposit Insurance Corporation, DCF has 225 branches in Michigan and 438 branches in Huntington. DCF employs approximately 7,300 people across its seven state tracks, and Huntington has about 15,700 in eight states.
Steiner admitted that some layoffs were expected for branches and staff, but he was unable to provide specific numbers on Sunday evening. A TCF spokesman said the consolidated bank would have “at least” 20,000 employees.
As part of the deal, Huntington plans to contribute $ 50 million to a new donor advisory fund with the Community Foundation for Southeastern Michigan. That funding will be in addition to other philanthropic loan initiatives undertaken by both banks in recent months.
In late October, the DCF underwent an administrative change following the retirement of CEO Craig Doll and President Tom Schaefer was elevated to the role.
I hope Schaefer wants to be with the new bank, but Steiner said the manager should make that decision.
He has been a financial advisor to Goldman Sachs & Co. LLC Huntington. Watchell, Lipton, Rosen & Cuts have been working as Huntington’s legal advisers.
Keefe, Freud & Woods, is a Stiffell company, serving as DCF’s financial advisor. Simpson, Thatcher & Bartlett LLP have been working as DCF’s legal advisers.
The DCF Bank deal marks the 14th merger into Huntington Bank, which has had a hand in Torgo Engineering since acquiring a small Troy-based bank called Michigan in 2007, later known as Dolmer Bank and Trust.
With the support of billionaire New York financier Wilbur Rose (outgoing U.S. Treasury Secretary), Dolmer Bank grew through its first acquisitions in 2011 through a series of mergers and acquisitions of small banks based in Warren, Ohio. , Then joined the board of directors of the bank’s CEO, Torco and co – executive David Provost, who was with them on subsequent mergers and acquisitions, usually serving as president and overseeing day – to – day operations.
In 2016, Torco, Provost and Schaefer took control of the Midland-based Chemical Bank and adopted the chemical name. Provost is a longtime experienced banker in Metro Detroit, having previously founded Bank of Bloomfield Hills in 1989 and sold to Chicago-based private bank Corp in 2006.
In 2019, Torco, Provost and Schaefer set their eyes on their biggest merger, just months after announcing Detroit’s new home to a bank that had long been rooted in the Midlands, Vesata merged with e – based DCF Bank Chemical Bank. The combination of DCF and Chemical initially became the 27th largest bank in the country with $ 47 billion in assets and $ 35 billion in deposits.
Torgo is a longtime Metro Detroit real estate developer and founder of the Sterling Group, which now runs children his age.
– Chad Livankood, Crane’s senior editor, contributed to the report.