Mercantile wins OK for $23 million bank sale to United Community

By Jim Witters

Wilmington, Del., Sept. 25 - Mercantile Bancorp, Inc. won approval for the sale of its interests in Mercantile Bank to United Community Bancorp Inc. for $23.03 million, according to documents filed Sept. 25 with the U.S. Bankruptcy Court for the District of Delaware.

The sale order from judge Kevin J. Carey was delayed by objections from the official committee of trust preferred securities holders.

Those objections were allayed by a settlement agreement that grants the committee review and consent power over any proposed waiver agreement with the Federal Deposit Insurance Corp. Other terms of the agreement were filed under seal and are not available for public review.

UCB emerged from a Sept. 12 auction as the prevailing bidder with a purchase price of $23,027,000 for the holding company's stock in the bank and the trademarked M logo.

The UCB purchase is contingent upon the debtors or UCB obtaining a waiver from the FDIC on an estimated $23 million cross-guarantee claim related to the FDIC's seizing of Mercantile's Royal Palm Bank and Heartland Bank.

Mercantile Bancorp, a Quincy, Ill., bank holding company, filed for bankruptcy on June 27. The Chapter 11 case number is 13-11634.

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