Robbins LLP: Acquisition of HF Financial Corporation (HFFC) by Great Western Bancorp Inc. (GWB) May Not Be in Shareholders’ Best Interests
Robbins LLP is investigating the proposed acquisition of HF Financial Corporation (NASDAQ: HFFC) by Great Western Bancorp Inc. (NASDAQ: GWB). On November 30, 2015, the two companies announced the signing of a definitive merger agreement pursuant to which Great Western Bancorp will acquire HF Financial. Under the terms of the agreement, HF Financial shareholders can elect to receive either 0.06500 shares of Great Western Bancorp common stock – which is currently valued at $19.70 – or $19.50 in cash for each share of HF Financial common stock.
Is the Proposed Acquisition Best for HF Financial and Its Shareholders?
Robbins LLP’s investigation focuses on whether the Board of Directors at HF Financial is undertaking a fair process to obtain maximum value and adequately compensate its shareholders.
As an initial matter, the merger consideration represents a premium of only 21% (cash offering) or 22% (stock offering) based on HF Financial’s one-month average closing price. This premium is significantly below the average one-month premium of nearly 42% for comparable transactions within the past five years.
On October 26, 2015, HF Financial reported strong earnings results for its first quarter 2016. Net interest income for the quarter was $9.6 million, an increase of 16% compared to the same period last year. Earnings for the quarter were $3.9 million, an increase of 113% compared to the same period last year. In commenting on these results, HF Financial President and Chief Executive Officer Stephen Bianchi remarked, “Over the past two years, we have better positioned our banking franchise to generate stronger returns on equity with healthier net interest margins, a branching platform that delivers quality service to our customers more efficiently, and a lending team with better coordination for reaching our customers. We also continue to improve workflows and examine our cost structure to maximize efficiencies.”
In light of these facts, Robbins LLP is examining HF Financial’s Board of Directors’ decision to sell the company now rather than allow shareholders to continue to participate in the company’s continued success and future growth prospects.
HF Financial shareholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for shareholders and the disclosure of material information.
HF Financial shareholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.