Zions holders tender 51.29% of floating-rate preferreds in offer

By Angela McDaniels

Tacoma, Wash., Dec. 22 - Zions Bancorp. said that according to preliminary information, holders tendered 2,861,493 depositary shares into its exchange offer. The shares represent $71,537,325, or 51.29%, of the company's approximately $140 million of outstanding series A floating-rate non-cumulative perpetual preferred stock.

An exchange offer for the depositary shares began Nov. 23 and expired at 11:59 p.m. ET on Dec. 21.

The preferreds represented by depositary shares received in the offer will be retired, and the offer will leave 2,718,072 depositary shares representing 67,951.8 preferreds outstanding, according to a company news release.

The depositary shares each represent a one-fortieth ownership interest in one preferred, and each preferred has a liquidation preference of $1,000.

Each depositary share will be exchanged for 0.9844 shares of common stock, which is equal to $13.00 divided by $13.2056, the relevant price.

The relevant price is the arithmetic average of the volume-weighted average price of Zions' common stock during the five consecutive trading days ending on the second trading day immediately preceding the expiration date.

If the relevant price had been less than $10.40, then 1.25 shares would have been issued for each depositary share accepted in the offer.

Zions will also pay cash for accrued dividends up to but excluding the settlement date.

The company said the exchange offer will increase its tangible common equity by an amount approximately equal to the liquidation preference of the depositary shares exchanged.

Deutsche Bank Securities Inc. and Goldman Sachs & Co. are acting as Zions' financial advisers in connection with the offer, and the information agent is D.F. King & Co., Inc. (800 901-0068 or 212 269-5550).

Zions is a financial services company based in Salt Lake City.

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