Comerica Investor Demands Details on Fifth Third Deal

HoldCo Asset Management is unhappy with Comerica’s pending acquisition by Fifth Third Bancorp.

The activist investor had pushed for the nearly $11 billion deal, but now says the sale was “flawed” and that Comerica had not allowed for an independent, competitive process, according to a report issued by HoldCo Monday (Nov. 17).

“It appears that Comerica steered the sale toward a preferred bidder (Fifth Third) rather than running an open, competitive process designed to maximize shareholder value,” the group wrote in its report, addressed to Comerica’s board and titled “Look What You’ve Done.”

The report was first flagged by Bloomberg News, which noted that the deal came after increasing pressure from Comerica investors, who saw the bank lagging competitors in loan growth and cost management.

Now, however, HoldCo is calling on Comerica to release further disclosures about the sale, including the name of another bidder mentioned in a recent regulatory filing, as well as Comerica’s discussions with “Financial Institution A.”

HoldCo accuses Comerica of choosing not to engage with this bidder’s “repeated, unsolicited proposals” and not disclosing a competing bid or soliciting a revised one. The report calls this choice “indefensible,” arguing that Financial Institution A’s preliminary offer would have gone higher after further negotiations.

Reached by PYMNTS, Fifth Third Bancorp declined to comment. PYMNTS also reached out to Comerica for comment but has not yet gotten a reply.

Fifth Third announced last month that it would acquire Texas-based Comerica in a $10.9 billion all-stock transaction. Fifth Third has said the acquisition will allow it to expand in the southwest, as it anticipates more than half its branches will be based in the Southeast, Texas, Arizona and California by 2030.

The deal follows other mergers this year in the regional banking space, such as PNC Bank’s acquisition of FirstBank out of Colorado for $4.1 billion, and Nebraska-based lender FNBOs merger with Missouri’s Country Club Bank.

Writing about the Fifth Third-Comerica deal last month, PYMNTS contended the acquisition was about more than just the deposits at stake.

“While deposit growth headlines dominate merger coverage, the Fifth Third-Comerica union will also enable technology integration, consolidating core systems, data analytics and payments infrastructure,” that report said.

“Unifying digital platforms across legacy systems can yield lower per-customer costs and greater operational flexibility, especially as competition intensifies from FinTechs.”