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Summarized by Kent Larsen
First Security Shareholders Say Yes, But Zions' May Not
Deseret News 23Mar00 B4
By Max Knudson: Deseret News business editor
and
First Security shareholders approve merger
Deseret News 22Mar00 B4
By Max Knudson: Deseret News business editor
But First Security OK may be moot unless Zions follows suit
SALT LAKE CITY, UTAH -- Shareholders of First Security Corp. approved
its proposed merger with Zions Bancorp Wednesday, as expected,
leaving the fate of the deal up to Zions shareholders, who will vote
on the deal March 31st. However, the Zions shareholder vote could be
a big hurdle, since recent events have made the deal much less
appealing to them, and recent comments by Zions executives put even
their support of the pact in doubt. Both banks have pioneer Mormon
roots and are run by predominantly Mormon management teams.
Since the deal was first approved, First Security Corp.'s share price
has fallen to the point that many Zion's shareholders don't think
they are getting much out of the merger. But if the deal falls apart,
First Security may be ripe for another suitor, since analysts see the
the stock's current price as "cheap."
Since a dramatic stock drop less than two weeks ago, First Security
and Zions executives have been sniping at each other over the merger,
Zion's suggesting that the deal be renegotiated so that the amount
Zion's is paying for First Security shares is lower.
But First Security CEO Spencer F. Eccles dismissed any possibility of
a hostile takeover by another bank, and indicated that First Security
would be fine if Zions' shareholders fail to approve the deal. He
also said that in spite of earlier threats, First Security has no
intention of suing Zions for breach of contract if shareholders fail
to approve the deal.
The share prices of both companies have fallen even further recently,
as stockholders evaluate the deal.
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