The stock of regional bank Synovus Financial Corp., headquartered in Columbus, surged to a 52-week high on Thursday amid news this week that federal antitrust regulators have given their nod of approval to the buyout of Cabela’s by Bass Pro Shops.
Shares of Synovus, which is the parent company of Columbus Bank and Trust, pushed to a high of $45.68 in trading Thursday on the New York Stock Exchange before profit-taking by investors reduced that to a close of $44.68 by the end of the day.
Synovus stock, however, regained some of that and pushed upward again on Friday with the overall stock market rising. It closed up 32 cents at an even $45 per share. That is far off the stock’s 52-week low of $28.53 per share.
The Associated Press and other media outlets reported Wednesday that the merger between outdoor and sporting goods retailers Bass Pro Shops and Cabela’s has finally received the blessing of the Federal Trade Commission. The deal was announced last fall.
Shareholders of Sydney, Neb.-based Cabela’s are scheduled to vote on the acquisition Tuesday during a special meeting. Springfield, Mo.-based Bass Pro Shops would pay Cabela’s investors $61.50 for each share of stock that they own. If consummated, the purchase would close in the third quarter of this year, which is in the July-September period.
If completed as proposed, Bass Pro Shops will gain the brick-and-mortar store presence, online site and catalog operation of Cabela’s. The latter also has a credit-card portfolio that Cabela’s has offered to sell to Capital One, a bank and card issuer that has drawn federal scrutiny in the deal.
That’s where Synovus comes in. The Southeast regional bank, with corporate offices overlooking the Chattahoochee River in Columbus, would act as a middleman of sorts. It would purchase the Cabela’s portfolio of store-branded credit cards, then resell it to Capital One while keeping $1.2 billion in brokered time deposits held by the Cabela’s financial operation — Lincoln, Neb.-based World’s Foremost Bank.
Synovus also is to receive $75 million for helping with the transaction, money that it can use for other financial goals. It also puts the regional bank in a national spotlight that perhaps lead to other financial opportunities down the road. The bank hasn’t said much about the Bass Pro Shops and Cabela’s deal, although Chairman and Chief Executive Officer Kessel Stelling did touch on it in an interview after April’s annual meeting of shareholders.
“We had been in discussions for quite some time,” Stelling told the Ledger-Enquirer. “I won’t go into the exact details because it involves four parties and everybody has their own regulatory filings. But we think it speaks well to our standing in the industry, our reputation in the financial services industry, our reputation with regulators and, quite frankly, our deep knowledge of the card services industry. So we were pleased to enter into the transaction. It sounds incredibly complex, but it’s really not. It’s an opportunistic transaction for us.”
Synovus is scheduled to release its second-quarter earnings report before the stock markets open on July 18.