Patriot National Bancorp, Inc., the parent company of Patriot Bank, N.A., and American Challenger Development Corp., announced they have entered into a definitive agreement under which Patriot will acquire American Challenger via a reverse subsidiary merger, with American Challenger surviving as a wholly owned subsidiary of Patriot.
Pursuant to the terms of the Merger Agreement, at the effective time of the Merger, American Challenger common stockholders will receive shares of Patriot common stock as consideration and American Challenger preferred stockholders will receive cash. The merger will create a purpose-driven, digital-first national bank with highly efficient operations to generate industry leading financial performance and a technology driven banking experience that will offer competitive rates and a premium customer experience.
Following the Merger, Patriot Bank will adopt the American Challenger business plan and will operate as two divisions – the Patriot Bank Division, which will continue to operate Patriot Bank's existing business, and the American Challenger Division, which will execute the high-growth American Challenger business plan.
The Proposed Transactions have been approved by the boards of directors of Patriot and American Challenger and are expected to close in the first quarter of 2022, subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals and approval by Patriot's shareholders.
Michael Carrazza, Chairman of Patriot, said, “We’re excited to have engineered this industry-disrupting merger. The combination transforms Patriot to what will become the largest digital bank in the U.S. Customers will benefit from an expanded array of services and a tech-savvy banking experience, while shareholders should benefit from the compelling value that will be created. Patriot’s team will remain intact and will be complemented by American Challenger’s team and digital platform capabilities.”
Felix Scherzer, Chairman and President of American Challenger, said, “We could not be more excited about the opportunities provided by this merger as it propels our purpose of shaking up banking in your interest.”
Raymond J. Quinlan, Board Member and CEO of American Challenger, will serve as CEO of the combined entity. Quinlan said, “We are building a digital bank that will leverage the best in technology and operational excellence to serve our customers and communities. This will be evident in the design and pricing of our banking products, in our delivery of superior personal service and in our clear commitment to corporate social responsibility. We believe in ‘banking for good’ and through our actions we will demonstrate that we are a purpose-driven financial institution.”
Advisors
BofA Securities, Barclays Capital Inc. and Keefe, Bruyette & Woods, A Stifel Company, are serving as private placement agents for Patriot in connection with the Recapitalization. Evercore served as financial advisor and provided a fairness opinion to Patriot. Blank Rome LLP served as legal advisor to Patriot. Sullivan & Cromwell LLP served as legal advisor to American Challenger. Squire Patton Boggs (US) LLP served as legal counsel to the placement agents.
Read the full announcement here.