Posted on: Friday, April 30, 2004
City Bank shareholders meet for last time as buyout praised
By Deborah Adamson
Advertiser Staff Writer
Last week CB Bancshares, the parent of City Bank, agreed to be bought by Central Pacific Financial Corp. for $420 million in cash and stock. The purchase must be approved by CB Bancshares shareholders, and a special meeting will be held within the next few months for that purpose.
Lionel Tokioka, chairman of CB Bancshares, said he was sorry for the year-long acrimonious fight that preceded the decision to sell the bank. "For anything negative that has happened, I take total responsibility," he said. "I apologize."
Jimmy Kawano, a shareholder from 'Ainakoa, said he was pleased with the deal.
"A merger is very good. You get the money plus Central Pacific Bank stock," said the 77-year-old Kawano, who owns 830 shares of CB Bancshares and 2,800 shares of Central Pacific.
Under the deal, CB Bancshares shareholders get $20 plus 2.6752 shares of Central Pacific stock for each share of CB Bankshares. As of yesterday's market close, the deal amounted to nearly $88 a share. CB Bancshares stock closed yesterday at $86.57.
City Bank shareholders can elect to get cash or stock, or both. If all cash, shareholders will receive money from a pool of $90 million, after which they would be compensated in Central Pacific stock.
At the meeting, CB Bancshares CEO Ron Migita focused on the advantages of a merger.
"We believe Central Pacific's revised offer is a fair price that better reflects the underlying value of your company," he said.
Migita noted that management feels "humbled by the overwhelming support" from shareholders, customers and business partners.
Erik Sandblom, a network administrator at City Bank who had waved signs opposing the merger, said he was concerned about possible layoffs despite assurances from Central Pacific that no one would be laid off as a result of the merger.
"There's advantages and disadvantages (to the merger). The disadvantage is probably in the long run, people are going to lose their jobs," he said. "In the long run, to be efficient, I don't think they can keep (all) their employees."
Reach Deborah Adamson at dadamson@honoluluadvertiser.com or 525-8088.
City Bank held what was likely to be its last annual shareholders meeting yesterday.
