Shares of Mason-Dixon Bancshares Inc. soared 70 percent yesterday, after the Westminster company said it agreed to be sold to BB&T; Corp., in a transaction valued at $256.9 million.
Mason-Dixon's shares jumped $19.50 to close at $47.25, and shares of BB&T;, an aggressive regional banking company from North Carolina, rose 87.5 cents, to $38.06.
The deal, which has been approved by the directors of both companies, will double BB&T;'s presence in Maryland to about $2.4 billion in assets.
Mason-Dixon's $1.1 billion in assets include 23 banking offices, a dozen consumer finance offices and three mortgage loan offices.
Most of Mason-Dixon's business is concentrated in Carroll County.
BB&T; has $35 billion in assets and 534 banking offices in Maryland, Virginia, Washington and the Carolinas.
"I think it is a great deal for both companies," said Jon Holtaway, senior vice president at Danielson Associates Inc., a bank and thrift consulting firm in Rockville.
Holtaway said Mason-Dixon excels in business lending, and that its loan officers know their market. "That [business lending] is the key profit center for the type of bank BB&T; is," he said.
John Allison, chairman of BB&T;, said Mason-Dixon will "fit nicely into our community banking approach. We think this partnership pushes us toward our goal of creating the world standard revenue-driven sales organization."
Thomas K. Ferguson, Mason-Dixon's president and chief executive, said the board of directors decided to sell the company after a series of planning sessions held last year.
The directors concluded that selling was the best option because bigger banks were selling more products at lower prices, and it would have been too costly to create a niche banking business that would set the company apart from competitors.
In addition, BB&T; had approached the company, and was offering a good price, Ferguson said. "It seemed to me that the time was right," Ferguson said. "BB&T; was head and shoulders above the rest. Their culture, their business plan, their vision."
Mason-Dixon employs 500 people, and Ferguson said back office operations will be consolidated. He said he does not yet know how many people will lose their jobs.
He expects BB&T; to retrain workers whose jobs are eliminated, and create more jobs in branches and in commercial, corporate and residential real estate lending.
Ferguson said stockholders will receive a "superior value" in the deal, and customers will get a broader array of products and services.
Mason-Dixon shareholders will get 1.30 shares of BB&T; common stock for each share of Mason-Dixon Bancshares Inc. common stock. Based on BB&T;'s closing price of $38.44 on Tuesday, the value for Mason-Dixon would be $49.97 a share.
Ferguson will be named executive vice president of civic and economic development for BB&T;'s Maryland region, and he will become a director of the company's board.
The companies said Westminster will become headquarters for BB&T;'s newest Maryland community bank region. Michael Oster, chief executive of Mason-Dixon's subsidiary, Carroll County Bank, will be named the new region's president.
BB&T;, with headquarters in Winston-Salem, has been growing rapidly by acquiring small and medium-sized banks in the Carolinas, Maryland, Virginia and Washington. In October, it completed its acquisition of Maryland Federal Bancorp Inc. of Hyattsville in a deal valued at $239.2 million.
Pub Date: 1/29/99