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Saturday, 14 September 2013 13:43

Chemical Financial plans $50M public offering

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Midland-based Chemical Financial Corp. (Nasdaq: CHFC) could raise more than $50 million in a public stock offering the company announced on Friday.

The company, which has bank branches across West Michigan, said it planned to offer 1.925 million shares of its common stock priced at $26 per share, with allowances for underwriters to purchase an additional 288,750 shares to cover over-allotments. Chemical Bank's stock closed at $28.28 on Friday, up 3.67 percent for the day.

After deducting discounts and expenses related to the offering, the net proceeds to Chemical Financial would be approximately $46.8 million — or about $53.9 million if the full over-allotment is exercised, according to a filing with the U.S. Securities and Exchange Commission.

In announcing the offering, Chemical Financial said it would use the proceeds "for general corporate purposes, which may include funding loan growth and long-term strategic opportunities that may arise in the future."

Chemical said the public offering should close on Sept. 18.

MiBiz first reported in June that Chemical Financial was preparing to raise capital should it decide to pursue additional acquisitions. In May, Chemical Financial filed a shelf registration that would allow it to sell up to $100 million in new shares in offerings "from time to time...[to] take advantage of business opportunities if and when such opportunities arise, subject to market conditions and the capital requirements of the company."

The shelf registration allowed Chemical Financial to sell any combination of securities and provides for flexibility in raising capital, if needed, and going to market with the additional shares within days, rather than months.

"It's more in preparation and to provide us the flexibility and the speed," Chairman, President and CEO David Ramaker said at the time. "In our way of looking at it, it's the prudent thing for us to do."

Keefe, Bruyette & Woods is the main underwriter of the offering, along with co-managers Raymond James & Associates and Sandler O'Neill + Partners LP.

Grosse Pointe-based investment bank Donnelly, Penman & Partners is acting as a selling group member.

Read 2358 times Last modified on Monday, 16 September 2013 09:18

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