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The parent company of TD Bank has agreed to acquire a Tennessee-based regional bank in a deal that will make it one of the six largest banks in the United States.
TD Bank Group plans to acquire First Horizon Corp. in an all-cash transaction valued at $13.4 billion, or $25 for each common share of First Horizon, the banks said in a statement today. TD Bank said the transaction would accelerate its long-term growth strategy in the U.S.
“First Horizon is a great bank and a terrific strategic fit for TD,” Bharat Masrani, TD’s president and CEO, said in the statement. “It provides TD with immediate presence and scale in highly attractive adjacent markets in the U.S. with significant opportunity for future growth across the Southeast.”
The Canada-based Toronto-Dominion Bank, which has U.S. headquarters in Cherry Hill, New Jersey, has more than 1,100 retail branches along the East Coast, according to FDIC data, including about 130 in Massachusetts.
First Horizon is headquartered in Memphis and has $89 billion in assets and 412 branches with over 1.1 million consumer, business and commercial customers in 12 states, according to the statement.
“TD will benefit from First Horizon’s strong regional presence, including leadership positions in Tennessee and Louisiana, additional density in Florida, the Carolinas and Virginia, and important footholds in the attractive Atlanta, Georgia, and Dallas and Houston, Texas markets,” the statement said.
The statement also noted that First Horizon’s markets offer growth opportunities because the populations there are expected to increase approximately 50 percent faster, or more, than the U.S. national average.
TD expects the combined U.S. institution to have $614 billion in assets, a network of 1,560 retail branches, and more than 10.7 million U.S. customers across 22 states. The deal is subject to regulatory approval in the U.S. and Canada, as well as approval by First Horizon shareholders. TD expects to close the deal in its fiscal first quarter, which runs from Nov. 1 to Jan. 31.
Bryan Jordan, First Horizon’s president and CEO, will join TD Bank Group as vice chair and will join the senior executive team. He will also be named to the board of directors for TD’s U.S. banking entities as a director and chair, the statement said.
Leo Salom, president and CEO of TD Bank in the U.S., will lead the combined businesses.
“The Southeastern U.S. represents a tremendous opportunity for TD and the addition of First Horizon’s commercial and specialty banking capabilities will position us as a leading national player in commercial banking,” Salom said in the statement. “We will combine our resources and capabilities and continue to invest in the region as we focus on delivering the most differentiated banking experience in our markets.”
