TD Bank to Gain Foothold in South with First Horizon Acquisition

On Feb 28, 2022

Cherry Hill-based TD Bank Group and First Horizon Corporation have signed a definitive agreement for TD to acquire First Horizon in an all-cash transaction valued at $13.4 billion, or $25.00 for each common share of First Horizon. Through this transaction, TD accelerates its long-term growth strategy in the US by acquiring a premier regional bank with an aligned culture and risk-management framework.

First Horizon is headquartered in Memphis, Tennessee, with assets of $89 billion as of Dec. 31. The institution operates 412 branches and serves more than 1.1 million consumer, business and commercial customers across 12 states. TD will benefit from First Horizon’s strong regional presence, including leadership positions in Tennessee and Louisiana, additional density in Florida, the Carolinas and Virginia, and important footholds in the attractive Atlanta, Georgia, and Dallas and Houston, Texas markets.

On a pro forma basis, excluding merger adjustments, TD’s US franchise1 will be a top 6 US bank, with approximately $614 billion in assets and a network of 1,560 stores, serving over 10.7 million customers across 22 states; globally, TD Bank Group will have approximately $1,841 billion in assets, with over 2,600 branches serving the needs of more than 27.5 million customers2.

Collectively, populations in First Horizon’s markets are expected to grow approximately 50% faster than the US national average, with some markets far exceeding that level, offering important future growth opportunities as TD invests in the region.

“First Horizon is a great bank and a terrific strategic fit for TD. It provides TD with immediate presence and scale in highly attractive adjacent markets in the US with significant opportunity for future growth across the Southeast,” said Bharat Masrani, group president and CEO, TD. “Working with the First Horizon team, TD will build upon the success of its strong franchise and deliver the legendary customer experiences that differentiate us in every market across our footprint.”

Following the closing of the transaction, Bryan Jordan, president and CEO of First Horizon, will join TD as vice chair, TD Bank Group, reporting to Masrani and will join the TD senior executive team. He will also be named to the boards of directors of TD’s US banking entities as a director and chair. Jordan will continue to be based in Memphis.

“We have built a very strong business at First Horizon, and by joining forces with TD, we will create extraordinary value for our key stakeholders with a shared customer-centric strategy, enhanced scale and a broader product set for our clients. This is a true growth story,” said Jordan. “We have long respected TD as a leader in US banking and are confident that its continued and growing investments in our local markets will extend our long history of community support.”

Leo Salom, group head, US retail, TD Bank Group, and president and CEO, TD Bank, America’s Most Convenient Bank®, will lead the combined businesses.

According to Salom, “The Southeastern US represents a tremendous opportunity for TD and the addition of First Horizon’s commercial and specialty banking capabilities will position us as a leading national player in commercial banking. We will combine our resources and capabilities and continue to invest in the region as we focus on delivering the most differentiated banking experience in our markets.

The transaction is expected to close in the first quarter of TD’s 2023 fiscal year, and is subject to customary closing conditions, including approvals from First Horizon’s shareholders and US and Canadian regulatory authorities.

Once the transaction is completed, Memphis, First Horizon’s current headquarters, will be an important regional hub for TD in the US Southeast, supporting customers and operations and contributing to local communities and economies. TD is also committed to retaining First Horizon’s client-facing bankers, with no planned branch closures as a result of the transaction. In addition, upon closing, $40 million will be contributed to a First Horizon foundation.

TD Securities and J.P. Morgan served as financial advisors and Simpson Thacher & Bartlett LLP and Torys LLP served as legal advisors to TD. Morgan Stanley & Co. LLC served as financial advisor and Sullivan and Cromwell LLP served as legal advisor to First Horizon.

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