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The Houston bank's four deals since September would not slow it down if it sees another good M&A opportunity, David Zalman says. Proxy filing details how it courted American State Financial.
April 27
Prosperity Banchares' deal to buy East Texas Financial Services is on hold after another bank holding company that owns a stake in the $212 million-asset East Texas filed a lawsuit to block the sale.
Prosperity said in a recent Securities and Exchange Commission filing that a suit was filed against East Texas and its directors on May 4. East Texas' shareholders approved the sale to the $11 billion-asset Prosperity on April 18, but the suit claims that the vote was improper and is seeking to invalidate the deal.
"Accordingly, the closing date of the transaction is uncertain at this time," Prosperity said in its 10-Q last week.
In an odd twist, the plaintiff and defendant have almost identical names. The plaintiff is East Texas Financial Corporation, a $373 million-asset holding company in Kilgore that owns two community banks, according to the Federal Deposit Insurance Corp. A call to the privately held company was not immediately returned, so it is unclear how large a stake it owns in East Texas Financial Services, which is the parent company of First Federal Bank Texas in Tyler.
Prosperity said in December that it was
It said at the time that the sale was expected to close in the first half of this year.
East Texas Financial Services had been looking for a buyer for more than a year, after its deal to be acquired by a private investor group fell through in August 2010.
"We are disappointed that this action has been taken and that the stockholders that voted in favor of this transaction must now wait to see if the merger can be completed," East Texas Financial Services President and Chief Executive Derrell W. Chapman said in a news release Wednesday. "We are working as diligently as possible to resolve the issue and we hope to do so as quickly as possible but as a result of the lawsuit the closing date of the merger is uncertain at this time."
