Many types of business transactions require a certain amount of capital. Some require large amounts of funds in order to complete. A business merger between large financial corporations is definitely one of these cases in which a large investment of capital will be necessary. This is part of the reason why National Penn Bancshares, which has one location in Maryland, has initiated a $100 million public offering.
The banking firm is planning on acquiring TF Financial Corp. for $138 million. TF Financial is the parent company of 3rd Federal Bank and has various branches all over the country. The company also has $846 million worth of assets, which include $609 million worth of loans and $692 million worth of deposits. The planned merger still requires the approval of TF Financial's stockholders in order to move forward and be finalized.
National Penn owns approximately $8.6 billion in assets and operates 111 office locations across two states, including Maryland. The company has stated that it has obtained approval from necessary regulatory agencies for completing the proposed merger. A special meeting between TF Financial stockholders is set to be held in mid-September in order to vote on whether to go forward with the merger.
Once the vote is finalized and stockholders have decided to accept the merger proposal, it will take a large investment of capital in order to complete the transaction. However, the company will need to properly plan when putting the investment capital to use in order to efficiently utilize resources. Additionally, the company will also have to include a compliance strategy in order to ensure that the transaction complies with rules and regulations. A compliance strategy will help to avoid future legal problems in Maryland or in any other state.
Source: Philadelphia Business Journal, "National Penn starts $100M public offering", Jeff Blumenthal, Sept. 8, 2014