Toronto-based Canadian Imperial Bank of Commerce (CIBC) announced on Thursday that it’s topped its original takeover bid for Chicago-based PrivateBancorp in a move to rescue the deal.
As part of the amended agreement, PrivateBancorp stockholders will receive US$24.20 in cash and 0.4176 of a CIBC share for each Bancorp share.
The deal is now valued at US$4.9 billion, or US$60.92 a share, representing a 20% increase in value compared with what shareholders would have received under the initial offer delivered last June. That calculation is based on Wednesday’s closing price of CIBC’s common shares in New York.
“We are pleased to have reached an amended agreement with PrivateBancorp,” says Victor Dodig, CIBC president and CEO, in a statement. “The quality of its management team and its focus on building a client-first culture make PrivateBancorp an excellent fit with CIBC.”
James Guyette, chairman of the board of Private Bancorp, says the revised terms account for the changes in “trading market conditions and the interest rate environment” since the deal was first brokered.
A meeting for PrivateBancorp shareholders to vote on the revised merger is expected to take place in mid-May.
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