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Greater Atlantic shelves tender offer for 6.5% convertible preferreds
By Susanna Moon
Chicago, Dec. 14 - Greater Atlantic Financial Corp. said it terminated the offer to purchase for cash between 505,040 and 649,151 of Greater Atlantic Capital Trust I's 6.5% cumulative convertible trust preferred securities.
The company said several conditions to the completion of the tender offer were not satisfied as of the tender deadline at 5 p.m. ET on Dec. 10. All securities tendered in the offer will be returned to the respective tendering holders or their custodians.
As of Nov. 30, holders had tendered 643,580 convertibles, which exceeded the minimum tender requirement, but the offer also required the receipt of all regulatory approvals and funding from MidAtlantic Bancorp, Inc. to finance the payment for the convertibles.
On June 15, Greater Atlantic entered into a merger agreement with MidAtlantic and GAF Merger Corp. In the deal, MidAtlantic was to acquire and recapitalize Greater Atlantic Bank, Greater Atlantic's wholly owned subsidiary.
The merger was conditioned on a successful tender offer for the convertibles.
The company previously said it would pay $1.05 in cash, less any withholding taxes and without interest, for each convertible.
The directors of Greater Atlantic and some additional holders that collectively own 311,587 of the convertibles had agreed to sell their convertibles to Greater Atlantic for $0.01 apiece in transactions entered into prior to the announcement of the tender offer.
Greater Atlantic said that these holders agreed to accept $0.01 for each of their convertibles to allow for a greater amount of consideration to be allocated to the remaining holders in the offer.
The depositary was Wilmington Trust Co. (302 636-6181). The information agent was Laurel Hill Advisory Group, LLC (917 338-3181).
Greater Atlantic, located in Reston, Va., is the holding company for Greater Atlantic Bank.
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