Like kudzu and Nascar, bank mergers are thriving in the South. On June 21 Charlotte-based Wachovia Corporation announced that it would spend $14.3 billion in stock to buy SouthTrust Corporation of Birmingham. The transaction is the biggest of three recent bank deals in Dixie, which has seen a lot of action because it has a relatively unconsolidated banking industry compared to other parts of the country. On May 9 Atlanta-based SunTrust Banks, Inc., agreed to buy National Commerce Financial Corporation of Memphis for $6.98 billion in cash and stock [Big Deals, August]. And Regions Financial Corporation of Birmingham came to terms on a $5.85 billion merger with Memphis-based Union Planters Corporation on January 23.
Wachovia’s offer represented a 21 percent premium to SouthTrust’s preannouncement stock price. The buyer will pick up SouthTrust’s network of branches in Alabama and Florida, as well as a smaller presence in Texas. The companies hope to close the deal in the fourth quarter, pending approval by various regulators as well as both companies’ shareholders.
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