TORONTO and CHICAGO, March 30,
2017 /PRNewswire/ -- Following unanimous approvals by
their respective boards of directors, CIBC (TSX: CM) (NYSE: CM) and
PrivateBancorp, Inc. (NASDAQ: PVTB) today announced that they have
entered into an amended merger agreement (the "Amended
Agreement").
Under the Amended Agreement, PrivateBancorp stockholders will
receive, upon completion of the proposed merger with CIBC,
US$24.20 in cash and 0.4176 of a CIBC
common share for each share of common stock of PrivateBancorp held.
Based upon yesterday's closing price of CIBC's common shares on the
New York Stock Exchange (US$87.92),
the Amended Agreement values PrivateBancorp at approximately
US$4.9 billion (C$6.6 billion or US$60.92 per share), which represents a 20
percent increase in value compared to the initial terms announced
on June 29, 2016. The Amended
Agreement values PrivateBancorp at approximately 2.7 times tangible
book value as of December 31,
2016.
James Guyette, Chairman of the
Board of PrivateBancorp, said, "We are pleased to announce the
revised terms of our proposed transaction with CIBC, which provides
our stockholders with a significant increase in value as compared
to the initial terms of the transaction. The amended terms agreed
between CIBC and PrivateBancorp reflect changes to trading market
conditions and the interest rate environment since we announced the
transaction in June 2016 as well as
PrivateBancorp's continued strong performance. Our Board believes
in the long-term strategic value of the combination and, after
careful consideration, unanimously supports the amended terms and
continues to recommend that PrivateBancorp stockholders approve the
transaction."
"We are pleased to have reached an amended agreement with
PrivateBancorp," said Victor G.
Dodig, CIBC President and Chief Executive Officer. "The
quality of its management team and its focus on building a
client-first culture make PrivateBancorp an excellent fit with
CIBC."
"We continue to believe that a merger between CIBC and
PrivateBancorp is a compelling opportunity that offers immediate
and long-term value for PrivateBancorp stockholders," added Mr.
Dodig. "For CIBC stockholders, completing this acquisition
accelerates our strategy of building a strong, innovative and
client-focused bank. The transaction will create opportunities for
CIBC to bank across borders for our Canadian clients, offer more
services to our existing U.S. clients and expand PrivateBancorp's
client relationships. We look forward to continuing to work closely
with PrivateBancorp to successfully complete the transaction and
realize the full benefits for our stockholders, employees, clients
and partners."
Larry Richman, President and CEO
of PrivateBancorp, added, "The PrivateBancorp team remains
enthusiastic about joining the CIBC family. This transaction will
enable us to accelerate our track record of success through
partnering with CIBC, and we look forward to closing the
transaction as expeditiously as possible."
Approvals and Timing
The companies currently expect to close the transaction in the
second calendar quarter of 2017. The transaction remains subject to
customary closing conditions, including approval by
PrivateBancorp's stockholders and by the federal banking regulators
in Canada and the United States.
As previously announced, PrivateBancorp has set March 31, 2017, as the new record date for its
special meeting of stockholders to consider and act upon the
revised merger agreement. PrivateBancorp stockholders of
record as of the close of business on March
31, 2017, will be entitled to vote at the Special Meeting,
which is expected to take place in mid-May.
PrivateBancorp investors with questions about the transaction or
how to vote their shares may contact PrivateBancorp's proxy
solicitors, Innisfree M&A Incorporated, by calling toll-free at
888-750-5834, or Alliance Advisors, LLC, by calling toll-free at
855-976-3324.
Additional Transaction Details
The total value of the consideration that PrivateBancorp common
stockholders will receive upon the closing of the transaction will
be based in part on the value of CIBC common shares at closing.
CIBC will satisfy aggregate consideration payable to PrivateBancorp
stockholders by paying approximately US$1.9
billion (C$2.6 billion) in
cash and issuing approximately 33.5 million CIBC common shares,
representing an approximately 40 per cent cash and 60 per cent
stock mix.
CIBC estimates that the completion of transaction will
contribute approximately US$340
million (C$450 million) of net
income in fiscal 2020 and become accretive to CIBC's earnings per
share within three years of the closing date.
CIBC expects to maintain a strong Common Equity Tier (CET) 1
ratio at closing above 10 per cent. CIBC's CET 1 ratio was 11.9 per
cent as at January 31, 2017.
About CIBC
CIBC is a leading Canadian-based global financial institution
with 11 million personal banking and business clients. Through our
three major business units - Retail and Business Banking, Wealth
Management and Capital Markets - CIBC offers a full range of
products and services through its comprehensive electronic banking
network, branches and offices across Canada with offices in the United States and around the world.
Ongoing news releases and more information about CIBC can be found
at www.cibc.com/ca/media-centre/ or by following on Twitter @CIBC,
Facebook (www.facebook.com/CIBC) and Instagram @CIBCNow.
About PrivateBancorp, Inc.
PrivateBancorp, Inc., through its subsidiary The PrivateBank,
delivers customized business and personal financial services to
middle-market companies, as well as business owners, executives,
entrepreneurs and families in all of the markets and communities it
serves. As of December 31, 2016, the
Company had 36 offices in 13 states and US$20.1 billion in assets. The Company's website
is www.theprivatebank.com.
Important Additional Information and Where to Find It
In connection with the proposed transaction, CIBC has filed with
the SEC a Registration Statement on Form F-4 that includes a Proxy
Statement of PrivateBancorp and a Prospectus of CIBC, as well as
other relevant documents concerning the proposed transaction. The
proposed transaction involving CIBC and PrivateBancorp will be
submitted to PrivateBancorp's stockholders for their consideration.
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval. STOCKHOLDERS OF PRIVATEBANCORP ARE URGED TO
READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS
REGARDING THE TRANSACTION AND ANY OTHER RELEVANT DOCUMENTS FILED
WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE
DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Stockholders will be able to obtain a free copy of the definitive
proxy statement/prospectus, as well as other filings containing
information about CIBC and PrivateBancorp, without charge, at the
SEC's website (http://www.sec.gov). Copies of the proxy
statement/prospectus and the filings with the SEC that will be
incorporated by reference in the proxy statement/prospectus can
also be obtained, without charge, by directing a request to CIBC,
Commerce Court, Toronto, Ontario,
Canada M5L 1A2, Attention: Investor Relations, 416 304-8726;
or to PrivateBancorp, Investor Relations, 120 S. LaSalle St.,
Chicago, IL 60603, 312
564-2000.
Participants in the Solicitation
CIBC, PrivateBancorp, their respective directors and executive
officers and other persons may be deemed to be participants in the
solicitation of proxies in respect of the proposed transaction.
Information regarding CIBC's directors and executive officers is
available in its Annual Report on Form 40-F for the year ended
October 31, 2016, which was filed
with the SEC on December 1, 2016, and
its management proxy circular and notice of annual and special
meeting of stockholders for its 2017 annual and special meeting of
stockholders, which was furnished to the SEC under cover of a Form
6-K filed with the SEC on March 9,
2017. Information regarding PrivateBancorp's directors and
executive officers is available in PrivateBancorp's proxy statement
for its 2016 annual meeting filed on Schedule 14A, which was filed
with SEC on April 8, 2016. Other
information regarding the participants in the proxy solicitation
and a description of their direct and indirect interests, by
security holdings or otherwise, is contained in the proxy
statement/prospectus and other relevant materials filed with the
SEC. Free copies of this document may be obtained as described in
the preceding paragraph.
Forward Looking Statements
Certain statements contained in this communication may be deemed
to be forward-looking statements under certain securities laws. All
such statements are made pursuant to the "safe harbor" provisions
of, and are intended to be forward-looking statements under,
applicable Canadian and U.S. securities legislation, including the
United States Private Securities Litigation Reform Act of
1995. These statements include, but are not limited to,
statements about the operations, business lines, financial
condition, risk management, priorities, targets, ongoing
objectives, strategies of PrivateBancorp and CIBC and the
regulatory environment in which they operate and outlook for
calendar year 2016 and subsequent periods. Forward-looking
statements are typically identified by the words "believe",
"expect", "anticipate", "intend", "estimate", "forecast", "target",
"objective" and other similar expressions or future or conditional
verbs such as "will", "should", "would" and "could". By their
nature, these statements require us to make assumptions, including
the economic assumptions set out in the reports of PrivateBancorp
and CIBC filed with the SEC, and are subject to inherent risks and
uncertainties that may be general or specific. A variety of
factors, many of which are beyond our control, affect our
operations, performance and results, and could cause actual results
to differ materially from the expectations expressed in any of our
forward-looking statements. These factors include: credit,
market, liquidity, strategic, insurance, operational, reputation
and legal, regulatory and environmental risk; the effectiveness and
adequacy of our risk management and valuation models and processes;
legislative or regulatory developments in the jurisdictions where
we operate, including the Dodd-Frank Wall Street Reform and
Consumer Protection Act and the regulations issued and to be issued
thereunder, the Organisation for Economic Co-operation and
Development Common Reporting Standard, and regulatory reforms in
the United Kingdom and
Europe, the Basel Committee on
Banking Supervision's global standards for capital and liquidity
reform and those relating to the payments system in Canada; amendments to, and interpretations of,
risk-based capital guidelines and reporting instructions, and
interest rate and liquidity regulatory guidance; the resolution of
legal and regulatory proceedings and related matters; the effect of
changes to accounting standards, rules and interpretations; changes
in our estimates of reserves and allowances; changes in tax laws;
changes to our credit ratings; political conditions and
developments; the possible effect on our business of international
conflicts and the war on terror; natural disasters, public health
emergencies, disruptions to public infrastructure and other
catastrophic events; reliance on third parties to provide
components of our business infrastructure; potential disruptions to
our information technology systems and services; increasing cyber
security risks which may include theft of assets, unauthorized
access to sensitive information, or operational disruption; social
media risk; losses incurred as a result of internal or external
fraud; anti-money laundering; the accuracy and completeness of
information provided to us concerning clients and counterparties;
the failure of third parties to comply with their obligations to us
and our affiliates or associates; intensifying competition from
established competitors and new entrants in the financial services
industry including through internet and mobile banking;
technological change; global capital market activity; changes in
monetary and economic policy; currency value and interest rate
fluctuations, including as a result of market and oil price
volatility; general business and economic conditions worldwide, as
well as in Canada, the U.S. and
other countries where we and CIBC have operations, including
increasing Canadian household debt levels and global credit risks;
our success in developing and introducing new products and
services, expanding existing distribution channels, developing new
distribution channels and realizing increased revenue from these
channels; changes in client spending and saving habits; our ability
to attract and retain key employees and executives; our ability to
successfully execute our strategies and complete and integrate
acquisitions and joint ventures; and our ability to anticipate and
manage the risks associated with these factors. This list is
not exhaustive of the factors that may affect any of our
forward-looking statements. These and other factors should be
considered carefully and readers should not place undue reliance on
our forward-looking statements. Additional information about these
factors can be found in the reports filed by PrivateBancorp and
CIBC with the SEC. Any forward-looking statements contained
in this communication represent the views of management only as of
the date hereof and are presented for the purpose of assisting our
stockholders and financial analysts in understanding our financial
position, objectives and priorities and anticipated financial
performance as at and for the periods ended on the dates presented,
and may not be appropriate for other purposes. We do not undertake
to update any forward-looking statement that is contained in this
communication or in other communications except as required by
law.
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SOURCE PrivateBancorp, Inc.