Michigan’s Talmer, Chemical banks to combine in ‘merger of equals’
Troy-based Talmer Bancorp Inc. and Chemical Financial Corp. of Midland will combine in a “merger of equals” to create the largest bank based in Michigan.
The combined bank will have more than $16 billion in assets and 266 locations across Michigan. Talmer Chairman Gary Torgow will be chairman of the combined entity, to be headquartered in Midland, and Chemical’s David Ramaker will be CEO of the new bank.
“We’re doing this now because we were headed toward a $10 billion bank and they were headed toward a $10 billion bank,” Torgow told The Detroit News Tuesday. “It enables us to serve customers in Michigan.”
David Provost, CEO of Talmer who will hold one of five Talmer seats on the combined company’s 12-member board, added “Two Ohio banks and two Michigan banks are merging on the same day. That creates the largest bank in Ohio, and we create the largest bank in Michigan.”
The Chemical-Talmer tie-up comes as Columbus-based Huntington Bancshares Inc. also said Tuesday that it will acquire FirstMerit Corp. of Akron in a $3.4 billion deal that will create Ohio’s largest bank by deposits.
“Under the terms of the definitive agreement,” the Michigan banks said in statement, “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 of $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.”
“This is clearly a transformational merger between two healthy Michigan banks with complementary geographies,” Ramaker said in a statement. “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.”
The deal enables Chemical to expand into the lucrative southeast Michigan market and into Ohio. Because Talmer branches are primarily in southeastern Michigan and northern Ohio while Chemical operations serve the rest of Michigan, the transaction is expected to have minimal impact on the employees of both banks.
The new bank will contribute $4.8 million to the Talmer-Chemical Foundation to be managed by the Community Foundation of Southeast Michigan. The transaction is expected to close in the third quarter.