Greensboro bank makes rival bid for Durham's historic M&F
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Triad Business Bank, a startup bank out of Greensboro, has emerged as a rival bidder for Durham's M&F Bank, the second-oldest Black-owned bank in the country.
Why it matters: Earlier this summer, M&F Bank agreed to a deal to be acquired by South Carolina's Optus Bank in a deal that would form the largest Black-owned bank in the country.
- But the deal would also lead to the end of the M&F Bank name — which has been in place since 1907 — and move its headquarters to Columbia, S.C.
Driving the news: Triad Business Bank, founded in Greensboro in 2020, has submitted four separate bids for M&F's consideration now, Jonathan Lee Kelly, a director at Triad Business Bank, told Axios.
- Each one of those would keep the M&F name and its headquarters in Durham, Kelly said.
State of play: M&F has acknowledged that another bank had submitted a bid to acquire it, though it hasn't said there had been four separate bids by that bank.
- So far, M&F has indicated it prefers the Optus bid and wants to pursue that option. That deal would also keep its CEO James Sills in place. (Kelly said Triad would be open to working with Sills going forward as well.)
- But M&F shareholders have yet to finalize a vote on the deal with Optus, and have already delayed a vote at least once.
What they're saying: "There's such a tremendous legacy with M&F and what it stood for, and the current transaction eliminates all that," Kelly told Axios.
- "The history is important, and we think it's powerful for what we're trying to do, not just for the Triad and the Triangle, but also the Charlotte area," he added. "It's a North Carolina story that we want to preserve. And if this bank disappears, there will be no more African American minority deposit institutions in the state."
- M&F Bank has not yet responded to a request for comment on the Triad Business Bank bid.
Between the lines: The preservation of the M&F name and headquarters was not the only difference between Triad Business Bank and Optus' deal.
- Both deals would create a combined bank of similar size with around $1 billion in assets.
By the numbers: The Triad deal would keep the two banks separate but would operate both under a holding company. The Optus deal takes over M&F entirely.
- Triad's deal would give M&F Bank shareholders the option to either receive $53.50 per share in cash for up to 25% of shares or 1.25 shares in the combined company.
- Optus' deal, on the other hand, would give M&F shareholders up to $46.57 per share, plus an additional $6.73 per share that is contingent on certain payments.
Zoom in: Triad believes its deal is more tax advantageous for shareholders because it does not force them to turn their existing shares into cash.
- Kelly argues that Triad would be better able to leverage the M&F legacy to invest more significantly with historically Black colleges like N.C. A&T and N.C. Central on housing or help faith institutions redevelop land for housing or other community uses like an urgent care or grocery stores.
What's next: M&F shareholders are scheduled to vote again on the Optus deal on Oct. 20.