Cayman National board tells shareholders to take deal

| 04/10/2018 | 40 Comments
Cayman National, Cayman News Service

Cayman National, Grand Cayman

(CNS): The Cayman National board of directors is expected to release a circular Friday about the take-over bid of the local bank by the Republic Bank Trinidad and Tobago (Barbados) Limited, in which it is recommending that shareholders accept the deal. Shareholders in the only Cayman-owned bank were offered a premium of more than $3 on the price of their shares on the day the proposal was made. “The Board believes that the Partial Offer is a good opportunity for Cayman National shareholders to realise the value of their investment,” the directors said in a statement released by the bank this week.

“After careful consideration, in consultation with its advisors, of the terms and conditions of the Partial Offer and having regard to the Fairness Opinion and in the absence of a superior proposal, the Board recommends that shareholders accept the Partial Offer,” the statement reads.

In making the decision, the board said it had carefully considered a number of matters, including the cash offer price of US$6.25 per share, representing a higher price than the shares have traded for at least ten years. But the ultimate decision will be made by the shareholders, who will be asked to vote at a meeting later this month.

In August Cayman National announced the unsolicited proposal, in which Republic said it was seeking to acquire a minimum of 51% and up to 74.99% of the issued shares of Cayman National by way of a tender offer to shareholders.

The initial proposal contemplated a price of between US$6 to 6.75 per share. On 12 September Cayman National said it had received a revised proposal at US$6.25 cash per share and a few days later published a circular about the offer stetting out the terms. The on 18 September the bank said it had entered into an implementation agreement with Republic.

The board said that the offer provides shareholders with the certainty of cash for any of the shares that are tendered. Republic has made several positive commitments in relation to the ongoing management and operation of Cayman National and its subsidiaries.

“Cayman National may benefit from being part of a larger group of companies,” the directors said, adding that there “may be adverse consequences associated with not accepting the Partial Offer”.

Cayman National appointed Deloitte as the independent financial advisor to prepare a fairness opinion, which was found to be fair from a financial point of view to Cayman National shareholders.

The directors’ circular, expected to be released tomorrow, will contain more details about the deal and the position of the board.

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Category: Banking, Business

Comments (40)

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  1. ALBERT MURDOCK says:

    Stockholders invest for a Return. While CNC has often paid two modest dividends most years, Thank you! Some years have been very lean. Since CNC is not listed on a larger stock exchange, it is very difficult to sell. I unsuccessfully tried to sell shares for $2.00/share for two years without a single sale. There is very little demand on CSX so the share price remains low & the dividend return is depressed. This seems a great chance for investors to realize a gain. The stock price is higher because it reflects the added value of acquiring control of the bank. If the acquisition occurs & control is obtained the share price will likely drop. Then those that sold at $6.25 can still buy back their shares for less. Win:Win Further there is the risk that new Non-Caymanian owners might not be as loyal or generous to the remaining shareholders. Perhaps they will need to make back their investment. And as pointed out by other commentators, locals can always incorporate another Cayman Bank.

  2. Anonymous says:

    We shall name it First Cayman Bank, what could possibly go wrong?

  3. Cayman's Foreclosure Begins says:

    Minority Shareholder i would vote no, just on the mere fact that Alden and his Cohort Boss Hogg are supporting this horse$#!@ What a disgrace! and my only hope is when the upheaval starts i hope you PPM/unity jackasses hold your dear leader Kim El Dounce responsible!

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  4. Minority Shareholder says:

    On the 9th October 2018 at the Marriott hotel West Bay Road vote NO to George Town bourgeois and their greedy and time honored selfishness. On 9th October 2018 vote NO to yet another piece of Cayman being sold off. On 9th October 2018 vote NO to another foreign controlled entity controlling and owning yet another piece of our financial industry. On 9th October 2018 vote NO to yet another third world and blacklisted jurisdiction using us to enrich their own economy and putting us at risk of getting on yet another OECD Blacklist. On 9th October 2018 vote NO to show our no use political dingbats your anger about what is happening to our little island and we are sick and tired of their spineless and disrespectful conducted. On 9th October 2018 vote NO to unemployment and redundancies for Caymanians and the reduction of direct influence in our own financial industry. On the 9th of October 2018 vote NO because this is not what the founders of this bank wanted and took steps to stop it. On 9th October 2018 vote NO in their memory and because they are not here to vote. On the 9th October 2018 vote NO to keep one of the first Caymanian banks Caymanian. On 9th October 2018 at the Marriott Hotel meeting Vote NO because its the right thing to do Cayman and the word CAYMANIAN means something! A NO vote Cayman will remind many here that we still have some influence and say in what happens to our little island. VOTE NO to the disrespect shown to Caymanians on their own island!!

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  5. Anonymous says:

    Well it is fair to say that most of these comments do not come from the people who have been shareholders since 2002, when the shares were bought for $5.50.

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    • 675 Denial says:

      75 cents profit? wow! buddie let me put to you if you do not have 20 million cash here now you ain’t saying bounce. Good luck with your chump change and your little nice car and your foreign banker and his schedule of fees scam, who couldn’t care less with your little whims.

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      • Anonymous says:

        Dear Dimwit, he’s suggesting it might be nice to finally have a way out after the price went south for so many years.

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    • Anonymous says:

      Yeah and now they sell them for 6.25. The Bank has been run for the benefit of top Management, their salaries and their perks How can so much cash be held and returns be so slim for an entity that has been around for 40 years.

  6. Anonymous says:

    I am shocked that some of you live in a financial sector island and knows nothing about this subject. Shareholders don’t have to sell if they don’t want.

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    • Anonymous says:

      They need to fire the Directors for making stupid recommendations to shareholders and elect a new Board of Directors. CNB is all we have left that is Caymanian, when and if CNB is gone the take over of the island would be complete. Never before in the history of the world has a country been invaded and taken over without a shot being fired. Be careful shareholders, short term gain and long term pain. It will be very difficult or almost impossible to replace your shares in this day and age with something of similar value that yield dividends that your current shares pay. It’s a hard pill to swallow but I’d rather see Dart in Control of CNB than Trinidad, at least he has Caymanian Status.

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      • Anonymous says:

        The board of directors are the majority shareholders, nice return on investment and remember they get paid in shares at a great discount.

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      • Anonymous says:

        Ask the government to sell shares in the airline or turtle farm if you want a piece of a Caymanian proposition.

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      • Anonymous says:

        You own the airline and the turtle attraction. Those are nice.

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  7. Anonymous says:

    Politicians this morning saying that if the sale of CNB goes through, shareholders should pay for a poor deal that the government of the day apparently made with CNB in order to keep CNB’s insurance company solvent.

    Well, tell that to the many middle class Caymanian’s who own shares in CNB and would like to make a profit. If these politicians really cared about Cayman then they should concentrate on the losses the government and the statutory authorities continue to incur year after year.

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    • Anonymous says:

      The Government could have exchanged their shares in the Insurance co for shares in C N C. When the Ins.co. was sold , (like we did) an now could sold them for big money. But common sense is not common any more,

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    • Anonymous says:

      8 37 how many shares u bought an did u do all your banking with C N B to support the corporation ?

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  8. Anonymous says:

    barbados controlling a local bank…no sah…i taking my money elsewhere if it hapoens…

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    • Anonymous says:

      Uhhh…sure that’s a wise decision! NOT!!!! Thanks for your support to the current employees of CNB!

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  9. V says:

    It is a great opportunity to open a new local Cayman Bank. I say go ahead and sell out.

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  10. Opposition Gangsta says:

    Look around Cayman at these people involve and ask yourself this what has them or Republic bank done for Cayman and they have been here for a very longtime Yet they or their business entities have contributed little our nothing to Cayman. Now because greedy board members and their foreign proxies at the bank think its a good idea and opportunity to sell out the Cayman identity of the bank for profit which was built up by Cayman and its residents. Now they have the nerve to threatened those who bought shares and built that name and profitability of the bank when it is in good standing. My question is why did they turn Republic Banks previous offer to purchase down and what has change now?

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  11. Howie Mandel says:

    So, what’s it gonna be? We’ll find out after this short commercial break…

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  12. Anonymous says:

    I guess we’ll have to rename it Cayman International Bank (CIB) !!!

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  13. say it like it is says:

    Just self serving, no doubt the directors own shares and want tp profit, is this really an arms length recommendation?.

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    • Anonymous says:

      So the shareholders don’t want to profit too ? If you want arms length advice hire a consultant, if you don’t like the deal don’t sell. If you don’t own shares, nobody cares.

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  14. Raffaelle says:

    My Fellow Caymanians DO NOT sell your Shares ! Have you forgotten 2009 CLICO?? and we all know how that end up The Founding fathers of CNB put a number rules in place to prohibit just this type of hostile taker by a foreign bank. Do not let them fool you. XXXX This is not a done deal as they would like you to believe, they have to have a meeting of shareholders to vote to change these rules put in place by the founding members. So they are trying to get all the shares to take away your vote!By the way Mr Tompkins would turn over in his grave. They then have to get approval from our government and CIMA to do this deal. TIme to stop this whole sale sell of these Islands how much more are we going to allow them to take they have realestate, food, Fuel, Power, and Banks already in foreign hands. None of those who instigating this have Cayman’s interest at heart. Too many people up in senior private sector positions who clearly have a conflicting interest have too much access to Cayman’s sensitive financial information??

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  15. Anonymous says:

    What a joke these money mongrels are. After Ivan, the Cayman Islands people via the CIG rescued this institution from going bankrupt. Now that they are back on their feet it seems they have forgotten. Is there anything, or anyone who can remain Caymanian that does not seek the Almighty Dollar. Does these shareholders realize that they will all die and take nothing..

    I always remember the words of the elders. A good name is better to be chosen than fine ritches. In common words. Respect and Reputation carries more value than money. The Caymanian people believed in CNB being solely Caymanian and has contributed to its success. It is for this reason why it should remain solely Caymanian.

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  16. Anonymous says:

    Is this ethical for the board to advise? What happens if the shares increase to say $10.50 in 3 years? Can the shareholders that sell now call foul? Why sell? Haven’t the shareholders been receiving good dividends? Remember our forefathers sold all the land on Seven Mile Beach and look where we are now.

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  17. Anonymous says:

    The share price has already increased, resulting in lesser margin /profit value for those who eventually choose to sell. You’re getting a few cents per share if you decide to sell.

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  18. Anonymous says:

    This is ridiculous and tantamount to strong arming minority shareholders.

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