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Deal Overview

Buyer:
Chemical Financial Corporation
Actual Acquirer:
Chemical Financial Corporation
Target:
Lake Michigan Financial Corporation
Deal Type:
Bank & Thrift Company
Agreement Date:
1/5/2015
Announcement Date:
1/6/2015
Announced Deal Value ($ M):
186.55
Status:
Completed
Completion Date:
5/31/2015
Announced Deal Value Per Share ($ )
56.42

Consideration Breakout
Cash ($M) 54.3
Common Stock ($M) 131.1
Common Stock Issued 4,322,101

Deal Pricing Ratios

Announcement Completion
Price / Book (%) 208.3 203.2
Price / Tangible Book (%) 208.3 203.2
Price / Earnings (x) 17.9 16.6
Price / Deposits (%) 19.52 18.79
Price / Assets (%) 15.74 15.10
Tangible Book Premium/ Deposits (%) 17.39 16.45
Deal Terms
Description of Consideration

Chemical Financial Corp. exchanged 1.326 shares of its common stock and paid $16.64 per share in cash to acquire each outstanding share of Lake Michigan Financial Corp. Chemical Financial Corp. redeemed Lake Michigan Financial Corp.’s trust preferred securities in Capital Trust III of $10.3 million. Lake Michigan Financial Corp.’s trust preferred securities in Capital Trust I and Capital Trust II became debt obligations of Chemical Financial Corp., these were assumed in transaction, in the amount of $18.6 million. Chemical Financial Corp. will expand in Ottawa County, Mich., by two branches to be ranked second with a 19.58% share of approximately $3.82 billion in total market deposits, will expand in Emmet County, Mich., by one branch to be ranked first with a 29.72% share of approximately $790.95 million in total market deposits, will expand in Kent County, Mich., by one branch to be ranked sixth with a 5.49% share of approximately $13.02 billion in total market deposits, and will expand in Grand Traverse County, Mich., by one branch to be ranked second with a 20.96% share of approximately $1.95 billion in total market deposits.

Accounting Method Acquisition
In-State Transaction? Yes
Merger of Equals? No
Geographic Expansion? In Market
Goodwill Generated ($ 000) 101,061
Estimated Cost Savings (%) 40.00
Estimated Cost Savings ($ 000) 10,800
Est. Restructuring Charges ($ 000) 15,000
Maximum Termination Fee ($ 000) 7,328
Minimum Termination Fee ($ 000) 0
Exchange Ratio (Common For Common) 1.326000
Exchange Ratio (Common For Preferred) NA
Exchange Ratio (Preferred For Common) NA
Exchange Ratio (Preferred For Preferred) NA
Lockup Agreement No
Strike Price ($ ) NA
% of Shares Outstanding NA
Shares Under Option NA
Core Deposit Intangibles ($ 000) 8,003
Deal Advisers
Financial Advisers
Party Advised Adviser Hired? Firm Name
Buyer Yes Keefe Bruyette & Woods Inc.
Seller Yes Sandler O'Neill & Partners LP
Legal Counsel
Party Advised Adviser Hired? Firm Name
Buyer Yes Warner Norcross & Judd LLP
Seller Yes Varnum LLP