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BankAtlantic Bancorp's hopes to move forward with its planned sale without the interference of its debt holders have been squashed by a Delaware judge.
January 4 -
Hedge fund Hildene Capital fights carve-out agreement, arguing that if BankAtlantic wants to sell most of its assets, the buyer has to assume its debt.
November 28
BankAtlantic Bancorp's deal to sell the bulk of its assets to BB&T Corp. has come under attack from yet another BantAtlantic investor.
Wells Fargo Bank, the trustee for an investor in BankAtlantic's trust-preferred securities, notified the bank last week that the proposed deal, in which BankAtlantic would sell only the best parts of its franchise while retaining the problem assets, violates the covenants of their debt agreement.
BankAtlantic disclosed its receipt of the default notice in a Securities and Exchange Commission filing late Thursday.
It is at least the fourth BankAtlantic has received from trust-preferred investors since the $3.7 billion-asset company announced Nov. 1 that it was selling its Florida branch network and the bulk of its performing assets to BB&T of Winston-Salem, N.C., for about $300 million. Upon completion of the sale, BankAtlantic would retain roughly $624 million of nonperforming and underperforming loans and recast itself as a specialty lender.
Hildene Capital, a New York hedge fund, was the first investor to object to the deal's structure, and has
Zions First National Bank, representing another group of trustees, has joined the lawsuit while Wilmington Trust Co., on behalf of other investors, has filed a suit of its own. BankAtlantic has attempted to have the Hildene suit dismissed, but a Delaware judge