A U.S. Bankruptcy Court in Delaware on Friday approved the sale of First Place Bank to Michigan-based Talmer Bancorp, leaving only regulators to decide whether the bank will assume new ownership.
Barring any qualms from regulators, Talmer essentially will pay $60 million for the bank’s assets, with $45 million going immediately to First Place bondholders, who will receive an additional $15 million, payable in full by 2033, said Talmer Bank and Trust’s Chief Financial Officer Dennis Klaeser.
Regulators are expected to approve the deal by year’s end, said Klaeser, who attended Friday’s hearing in Wilmington, Del.
First Place Financial Corp., the parent company of First Place Bank, first filed for bankruptcy Oct. 29 when it determined it no longer could reconcile the debt it incurred when its Michigan real-estate ventures faltered in 2008.
An objection from the U.S. Treasury Department filed in late November led Judge Brendan L. Shannon to reshape the terms of the deal in order to attract other competitive bids.
First Place Financial Corp. still owes the Treasury Department $72.9 million in bailout funds paid to the bank in 2008. The debt is unrelated to the Talmer sale, and its payment will be dealt with further during bankruptcy proceedings.
When no competitors came forward by Thursday’s deadline, an auction for the bank’s assets was canceled.
In reshaping the deal, Talmer increased its initial offer from $45 million to $60 million.
As a result, Klaeser said the company will receive another FPFC subsidiary, First Place Holdings, which counts as its primary asset a small office building in Boardman, as well as a small share of tax receivables expected to be refunded through company returns.
Talmer also intends to pump $205 million worth of capital into First Place Bank.
Officials at both First Place and Talmer have insisted that customers at the bank’s 41 retail locations will be unaffected by the acquisition.
The bank is expected to keep its name and a portion of its board members, and loans will continue to be serviced and processed. “We’re pleased to be moving forward with this so that we can contribute a substantial amount of capital to the bank and continue making it a very active part in serving the community,” Klaeser said.