The total deal value of terminated US bank M&A transactions has surged to a record high after the termination of the deal between Toronto-Dominion Bank and First Horizon Corp.
Four bank deals with a total deal value of $13.79 billion have been terminated in 2023 so far, according to an S&P Global Market Intelligence analysis. The $13.67 billion TD-First Horizon deal termination is responsible for the overwhelming majority of that total.
The most recent terminated deal was Fairmont, W.Va.-based MVB Financial Corp.'s planned acquisition of Raleigh, NC-based Integrated Financial Holdings Inc., an all-stock deal valued at $98.6 million at announcement.
Regulatory process delays, market volatility take toll
The parties in three of the four scrapped deals attributed their terminations to delays in the regulatory approval process.
Olympia, Wash.-based Washington Business Bank said its planned sale to an individual investor was scrapped as the regulatory approval process took longer than expected, and MVB and Integrated Financial also experienced delays in the regulatory process. TD and First Horizon cited an unclear line of sight for regulatory approval, with industry experts believing a regulatory issue with TD possibly sidelined the deal.
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The terminations of the TD-First Horizon and MVB-Integrated Financial deals came on the heels of three regional bank failures and industrywide liquidity concerns.
Among other drivers of the termination of the deal between MVB and Integrated Financial were "changing market conditions that have pressured bank industry stock prices," according to a news release.
The $98.6 million value of the MVB-Integrated Financial deal at Aug. 12, 2022, the date the deal was announced, plunged to $47.4 million as of market close May 9, the date the deal was terminated, according to S&P Global Market Intelligence data.
Largest terminated deals through the years
The second-largest terminated US bank deal ever is Los Angeles-based First Interstate Bancorp's planned sale to First Bank System Inc., the predecessor of U.S. Bancorp. The transaction was announced Nov. 6, 1995, with a value of $10.69 billion, and terminated Jan. 24, 1996.
The second-most recent terminated deal on the largest deal terminations list is Charlottesville, Va.-based Blue Ridge Bankshares Inc.'s scrapped merger with Fairfax, Va.-based FVCBankcorp Inc., which was valued at $306.9 million at July 14, 2021, the deal announcement date. The transaction was scrapped Jan. 20, 2022.
