This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration. Need a new registration confirmation email? Click here
Sterling Bancshares (SBIB) of Houston, Texas, saw its shares return 23% during the first quarter, to close at $8.61 Thursday.
The company announced a on January 18 an agreement to be acquired by
Comerica (CMA) of Dallas, in an exchange of shares valued at $1 billion.
Comerica agreed to exchange 0.2365 of its shares for each share of Sterling, and valued the deal at about $10 for each share for Sterling, whose stock had closed at $7.70 on January 18.
Comerica agreed to pay about 2.3 times tangible book value for Sterling, according to SNL Financial, for a deal that was considered expensive in the current industry environment. Comerica's shares declined 13% during the first quarter, to close at $36.72 Thursday.
When factoring-in the exchange ratio and the decline in Comerica's share price, Sterling's shareholders would have received value of $8.68 a share, if the merger had been completed on Thursday.
The deal is expected to be completed by the end of the second quarter.
Sterling is scheduled to announce its first-quarter results on April 19, with analysts expecting the company to earn two cents a share.
One of the 14 analysts covering Sterling rates the shares a buy, while the all remaining analysts have neutral ratings.