Bank of Queensland today welcomed the decision by shareholders in Pioneer Permanent Building Society to overwhelmingly support the merger of the two financial institutions.
Pioneer shareholders today voted overwhelmingly in favour of the merger. Of the shares voted, 99% were in favour and only 1% against or abstaining. A total of 97% of shareholders present voted in favour. Bank of Queensland needed 75% of shares and more than 50% of shareholders present (by number) to vote in favour for the merger to proceed.
BOQ’s offer was for 100 per cent of Pioneer Permanent Building Society’s issued capital at a value of $4.78 per share. Some shareholders will also be able to take advantage of the 21.8 cents franking credit on the fully franked special dividend.
The offer values Pioneer at $49.6 million and provides Pioneer shareholders with flexible options including the payment of a fully-franked dividend to all shareholders and the balance in BOQ shares or cash, or a mix of their choice.
Pioneer’s Chairman Clifford Flor said Pioneer’s shareholders had followed the recommendation of the Pioneer Board to support the merger proposal.
“Bank of Queensland’s offer had the unanimous support of Pioneer’s Directors and has today received very strong support from Pioneer shareholders. The merger with BOQ is good for our shareholders and provides improved opportunities for our customers, staff and preferred partners,” Mr Flor said.
“Pioneer shareholders now have the opportunity to participate in a larger entity, financially and operationally, and to benefit from future synergies resulting from combining the BOQ and Pioneer businesses. It also gives our shareholders the opportunity to access a much more liquid stock.”
Bank of Queensland Chairman Neil Roberts welcomed the support of Pioneer shareholders, and congratulated the outgoing Pioneer Board of Directors for their foresight in supporting the merger.
“The Bank of Queensland Board believes this is a great merger for both entities, and welcome those Pioneer shareholders who decided to take up the stock option in Australia’s fastest growing bank,” Mr Roberts said.
BOQ Managing Director David Liddy said Pioneer would join with an Australian banking success story in BOQ.
“We strongly believe the merger of Bank of Queensland and Pioneer will provide the Bank with strong market synergies in the booming Central and North Queensland economies. It gives us more scale in our home Queensland market, which is one of the strongest in the country,” Mr Liddy said.
Mr Liddy said Bank of Queensland’s team would now work closely with Pioneer’s staff to bring the two entities together. He said it would be “business as usual” for Pioneer until at least Christmas as integration and synergy plans are implemented.
“This merger means Pioneer customers will have access to a more comprehensive product offering and national reach through BOQ’s branch, ATM and business banking networks,” he said.
“We have committed to establishing BOQ’s regional head office in Mackay and we expect there will be little change in the external operations of Pioneer over the next six months,” he said.
Application for final approval of the Scheme of Arrangement will be made to the court on December 4 and subject to that approval being granted, BOQ will then take official ownership of Pioneer on December 5.
Bank of Queensland
Bank of Queensland is Australia’s fastest growing regional bank with more than 200 branches throughout Queensland, NSW, Victoria, Western Australia, ACT and the Northern Territory. In the last five years it has more than doubled its branch numbers, its assets under management have more than trebled to $16 billion while its market capitalisation has grown from approximately $400 million to almost $1600 million. Bank of Queensland has won Best Regional Bank in the AB&F Banking and Finance Awards twice in the last four years and is recognised as one of the highest customer service banks in the country.
Pioneer Permanent Building Society Limited was formed in 1967 and was registered as a Building Society on 1 February 1968. It announced a preliminary pre-tax profit for year ending June 30, 2006 of $2.8 million. It has an extensive network of branches and agencies throughout Central and North Queensland. Pioneer Permanent is based in Mackay Queensland, and listed on the ASX with total assets of more than $500 million and funds on deposit of more than $450 million.
BOQ is being advised by ABN AMRO Corporate Finance as financial adviser and Minter Ellison as legal adviser. Pioneer is being advised by Jacobson Consulting Pty Ltd (corporate adviser) and Nicol Robinson Halletts (legal adviser).