Return to search

NAFH To Buy 90.1% of Green Bankshares for $217 Mln

North American Financial Holdings has agreed to buy a 90.1% stake in Green Bankshares for $217 million. NAFH is a is a “blind pool” that raised $900 million in 2009. Investors include Crestview Partners and Falfurrias Capital Partners. Green Bankshares, of Greeneville, Tenn., is parent of GreenBank which has $2.4 billion in assets and 65 branches.

PRESS RELEASE

North American Financial Holdings, Inc., (“NAFH”), a North Carolina-based national bank holding company, announced today that it has signed a definitive investment agreement to acquire a 90.1% stake in Green Bankshares, Inc. (NASDAQ: GRNB) for $217 million. The Greeneville, Tennessee-based holding company is the parent of GreenBank, a 65-bank branch network with $2.4 billion in assets headquartered in Greeneville, Tennessee, with operations in Nashville, Knoxville and other Tennessee markets.

The NAFH investment will be composed of approximately 120 million newly issued shares of Green Bankshares’ common stock at a price of $1.81 per share. In addition, and upon consummation of the investment, Green Bankshares’ current shareholders will receive a Contingent Value Right, entitling them to cash proceeds of up to $0.75 per share, based on the credit performance of GreenBank’s legacy loan portfolio over the five years following closing.

This investment will bring NAFH to approximately $7.3 billion in assets with 149 branches throughout the Southeast, from Southern Florida to the Carolinas, and now including Tennessee. Commenting on the investment, NAFH Chairman and CEO Gene Taylor stated, “This investment helps define NAFH as a broad Southeastern franchise. The fast-growing Nashville and Knoxville markets serve as a natural extension of our western footprint and allow us to integrate our businesses seamlessly. With the capital from this investment, we believe GreenBank will be well positioned to benefit from an improving economy and we expect to close our investment and begin accelerating business development activities throughout Tennessee very quickly.” Upon closing, Mr. Taylor will become CEO of Green Bankshares.

The investment agreement contemplates that GreenBank will be combined with NAFH National Bank at a future date. GreenBank’s Steve Rownd, current Chairman and CEO of Green Bankshares, is expected to become a member of NAFH’s senior management team following the close and is expected to serve as NAFH Market President for Tennessee.

Steve Rownd noted, “This partnership provides stability for GreenBank and its shareholders, enhanced ability to service our clients and great future opportunity for our employees.”

Christopher G. Marshall, NAFH CFO, commented, “Our investment will significantly enhance GreenBank’s capital position as compared to other banks in Tennessee and allows us to continue building a strong, high performing southeastern regional bank on terms that are consistent with our shareholders’ return expectations.“ Upon closing, Mr. Marshall will become CFO of Green Bankshares.

The transaction is subject to shareholder approval and receipt of any required regulatory approvals and is expected to be consummated in the third quarter of 2011.

Wachtell, Lipton, Rosen & Katz acted as legal advisor for NAFH. Keefe, Bruyette & Woods, Inc. served as financial advisor to Green Bankshares and Bass, Berry & Sims PLC served as legal advisor to Green Bankshares.

About NAFH

North American Financial Holdings, Inc. is a national bank holding company that was incorporated in the State of Delaware in 2009. NAFH has raised approximately $900 million of equity capital, which it intends to invest in undercapitalized banks with the goal of establishing a strongly capitalized, high performance regional bank. NAFH has previously invested in TIB Financial Corp., MetroBank of Dade Country, Turnberry Bank, First National Bank of the South and Capital Bank Corporation.

The management team of NAFH includes:

R. Eugene (Gene) Taylor, NAFH Chairman and Chief Executive Officer. Mr. Taylor retired as Vice Chairman of Bank of America following a 38-year career during which he served as President of Bank of America’s Consumer and Commercial Bank and the Global Corporate and Investment Bank. He is a native Floridian and a graduate of the Florida State University School of Business.

Christopher (Chris) G. Marshall, NAFH Chief Financial Officer, previously served as CFO and COO of Bank of America’s Global Consumer and Small Business Bank and as Chief Financial Officer of Fifth Third Bank. Mr. Marshall graduated from the University of Florida and earned an MBA from Pepperdine University.

R. Bruce Singletary, NAFH Chief Risk Officer, spent 31 years at Bank of America in various credit risk roles, including serving as Chief Risk Officer for Bank of America’s Florida Bank. Mr. Singletary graduated from Clemson University and earned an MBA from Georgia State University.

Kenneth (Ken) A. Posner, spent 15 years at Morgan Stanley, most recently serving as a Managing Director and equity research analyst for a wide range of financial services firms. Mr. Posner is a graduate of Yale College and earned an MBA from the University of Chicago.

About Green Bankshares, Inc.

Greeneville, Tennessee-based Green Bankshares, Inc., with total assets of approximately $2.406 billion at December 31, 2010, is the holding company for GreenBank. GreenBank, which traces its origin to 1890, has 63 branches across East and Middle Tennessee, and one branch in each of Bristol, Virginia, and Hot Springs, North Carolina. It also provides wealth management services through its GreenWealth Division and residential mortgage lending through its Mortgage Division. In addition, GreenBank conducts separate businesses through three wholly owned subsidiaries: Superior Financial Services, Inc., a consumer finance company; GCB Acceptance Corporation, a consumer finance company specializing in automobile lending; and Fairway Title Co., a title insurance company.

Cautionary Statement

The investment discussed above involves the sale of securities in a private transaction that will not be registered under the Securities Act of 1933, as amended, and will be subject to the resale restrictions under that act. Such securities may not be offered or sold absent registration or an applicable exemption from registration requirements. This document does not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of securities in any state or jurisdiction in which such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.