Huntington Bancshares to buy Camco Financial; Chesapeake Energy lays off 800; retailer Rue21 goes private; more
Huntington Bancshares to buy Camco Financial
Regional bank holding company Huntington Bancshares is buying Camco Financial, parent of Advantage Bank, in a cash-and-stock deal valued around $97 million. The purchase price includes outstanding options and warrants. Camco Financial Corp. shareholders can choose to receive 0.7264 shares of Huntington common stock or $6 in cash for each share of Camco Financial stock they own. Huntington Bank President and CEO Steve Steinour said in a statement that the transaction will help enhance the company's presence in existing areas and broaden its reach into new areas. It also will give existing customers more bank branches to use, he added. Advantage Bank, based in Cambridge, Ohio, has more than 55,000 customers. Huntington Bancshares Inc., based in Columbus, Ohio, expects the acquisition to add to its earnings per share in the first full year. Both companies' boards unanimously approved the deal, which is expected to close in the first half of 2014. It still needs the approval of Camco stockholders and regulators.
Cheaspeake lays off 800, including 20 in Pa.
Chesapeake Energy Corp. said it laid off 800 employees company wide on Tuesday, including about 20 in Pennsylvania. CEO Robert D. “Doug” Lawler told employees that “we will position Chesapeake to be a sustainable, enduring enterprise ... to achieve the leadership role in the (natural gas) exploration and production business that this company can deliver.” A restructuring announced in June and targeted to be completed by Nov. 1 is now completed, he said. The layoffs were in land, operations, information technology, human resources, legal, finance and accounting. Eligible employees were offered a severance package. Lawler replaced former CEO Aubrey McClendon, who resigned April 1 amid federal investigations of a portfolio of personal loans that topped $840 million and cratering gas prices that drained the company of cash. Chesapeake is the leading shale gas driller in Pennsylvania. A year ago, the company had 20,000 employees, including about 1,500 in the state.
Rue21 completes deal to go private
Rue21 Inc., the teen fashion apparel retailer, said funds run by Apax Partners completed the $1.1 billion acquisition of the Marshall-based company on Thursday. Rue21, which employs about 10,000 worldwide and about 300 at the headquarters, agreed to be acquired for $42 a share in cash and be taken private in May. Apax funds already owned 30 percent of the retailer. Rue21 had been struggling this year to grow same-store sales, a measure of a retailer's performance, and had been forced to discount merchandise deeply to sustain sales. The company, which operates 982 stores in 47 states, estimated fiscal second-quarter sales would increase 13 percent to $229 million from $202 million the year earlier. In their last day of trading, rue21 shares closed at $41.99, up 75 cents.
EDMC CEO's compensation jumps 46%
Total compensation for Edward West, CEO of struggling Education Management Corp., jumped 46 percent to $6 million from $4.1 million the year earlier, all due to an increase in the value of his stock options, according to a securities filing. The base salary for West, who became chief executive of the nation's second-largest operator of for-profit schools in August 2012, dipped to $568,007 from $584,812, and his cash incentive pay declined to $531,250 from $583,627. But the value of his company stock options jumped to about $4.8 million from $2.8 million. Based Downtown, EDMC has been beset by sagging school enrollment and government scrutiny of its business practices. It lost $268 million in the fiscal year ended June 30, after losing $1.52 billion the year before. EDMC operates 110 schools in 32 states and Canada, including the Art Institute of Pittsburgh. It employs 23,000 people, including 2,400 in Pittsburgh. The company will hold its annual meeting in Atlanta on Nov. 8 at the Grand Hyatt Atlanta. Shareholders will vote on two director nominees, including former H.J. Heinz Co. CEO William Johnson, whom EDMC chose earlier this month to serve as board chairman.
JPMorgan sells off short-term Treasurys
JPMorgan Chase said it has sold all of its exposure to short-term U.S. government debt out of its money market funds, following a similar move by other money market mutual fund managers. A day earlier, Fidelity Investments said it no longer holds any U.S. government debt that comes due around the time the nation could hit its borrowing limit. In a statement on Thursday, JPMorgan said its money market funds no longer hold any Treasurys that mature or have payments scheduled between Oct. 16 and Nov. 6. The bank said it has increased its liquidity position in the funds. While JPMorgan Chase & Co. said it believes the probability of a government default is low, it's taking precautionary measures to protect investors.