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Issuer Free-Writing Prospectus Filed
Pursuant to Rule 433
Dated April 26, 2010
Registration Statement No. 333-166300
Supplementing Preliminary Prospectus Supplement
Dated April 26, 2010 and
Prospectus Dated April 26, 2010
For Immediate Release
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Contact:
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Patrick A. Reynolds
Director of Investor Relations
(706) 649-4973 |
Synovus Announces Ongoing Elements of Capital Plan
and Announces Rights Plan
April 26, 2010 Synovus Financial Corp. (NYSE: SNV) today announced ongoing elements of its
Capital Plan, consisting of initiatives expected to increase its Tier 1 common equity by
approximately $630 million and improve its Tier 1 common equity ratio to 8.50%.
The initiatives announced today include:
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a public offering of $400 million of common stock; |
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a public offering of $200 million of tangible equity units, or tMEDS (consisting of
prepaid common stock purchase contracts (recorded as equity) and junior subordinated
amortizing notes (recorded as debt)), and |
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an offer to exchange up to 97 million shares of Synovus common stock for any and all
outstanding 5.125% Subordinated Notes Due 2017. |
These offerings and the exchange offer are ongoing steps in our previously announced plan to
strengthen our capital position, said Richard Anthony, Synovus Chairman and CEO. Additional
capital will contribute to our ability to come out of this cycle soon and take advantage of future
opportunities that arise from an evolving financial services landscape.
Synovus believes that upon completion of these initiatives, it will:
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possess a capital structure, and related regulatory capital ratios, that will better
align with evolving industry and regulatory standards; |
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possess a capital cushion that will improve its ability to absorb additional losses
that it could face under worsening economic conditions; |
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enjoy greater operational and strategic flexibility, which could, among other things,
better position it to take advantage of potential opportunities to improve and grow its
business over time; and |
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be better positioned to possibly repay TARP as credit metrics improve. |
Synovus also announced a rights plan today intended to preserve substantial tax benefits for the
company and its shareholders.
Common Stock and tMEDS Offerings
Proceeds from the common stock and tMEDS offerings will be used for working capital and general
corporate purposes. The underwriters of the respective offerings will have an option to purchase
up to an additional 15% of the offered amount of common stock and tMEDS sold in the offerings.
Exchange Offer
We have launched an offer to exchange up to 97 million shares of our common stock for any and all
of our outstanding 5.125% Subordinated Notes due 2017, which we originally issued in 2005 in
aggregate principal amount of $450 million. The exchange offer is currently expected to close on
or about May 21, 2010.
Rights Plan
Synovus Board of Directors has adopted a shareholder rights plan designed to preserve substantial
tax assets. This plan is similar to tax benefit preservation plans adopted by other public
companies with significant tax attributes.
Synovus tax attributes include net operating losses, capital losses and certain built-in losses
that it could utilize in certain circumstances to offset taxable income and reduce its federal
income tax liability.
Synovus ability to use its tax attributes would be substantially limited if there were an
ownership change as defined under Section 382 of the Internal Revenue Code and related Internal
Revenue Service pronouncements. In general, an ownership change would occur if Synovus 5-percent
shareholders, as defined under Section 382, collectively increase their ownership in Synovus by
more than 50 percentage points over a rolling three-year period. The shareholder rights plan is
designed to reduce the likelihood that Synovus experiences such an ownership change by deterring
acquisitions that would increase the holdings of existing 5-percent shareholders or cause any
person or group to become a 5-percent shareholder. 5-percent shareholders generally do not include
certain institutional holders, such as mutual fund companies, that hold Synovus equity securities
on behalf of several individual mutual funds where no single fund owns 5 percent or more of Synovus
equity securities.
As part of the plan, the Board of Directors declared a dividend of one preferred stock purchase
right for each outstanding share of Synovus common stock. The preferred stock purchase rights will
be distributable to shareholders of record as of April 29, 2010, as well as to holders of common
stock issued after that date, but would only be activated if triggered by the plan and will not
trade separately from Synovus common stock until that time.
Synovus Board of Directors has the discretion to exempt any acquisition of company securities from
the provisions of the shareholder rights plan. The plan may be terminated by the Board at any time
prior to the preferred stock purchase rights being triggered.
The issuance of the preferred stock purchase rights will not affect Synovus reported earnings per
share and is not taxable to Synovus or its shareholders.
For more information regarding the shareholder rights plan, please see the Current Report on Form
8-K filed by Synovus with the SEC on April 26, 2010 and the Registration Statement on Form 8-A that
Synovus will file with the SEC on or about April 29, 2010, each of which is, or will be, available
on the SECs website at www.sec.gov.
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About Synovus
Synovus is a financial services holding company with over $32 billion in assets based in Columbus,
Georgia. Synovus provides commercial and retail banking, as well as investment services, to
customers through 327 offices and 461 ATMs in Georgia, Alabama, South Carolina, Florida and
Tennessee. The company focuses on its unique decentralized customer delivery model, position in
high-growth Southeast markets and commitment to being a great place to work to ensure unparalleled
customer experiences.
About this Press Release
This press release is for informational purposes only and is not an offer to sell or the
solicitation of an offer to buy any securities nor shall there be any sale of these securities in
any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such jurisdiction.
Forward-Looking Statements
This press release and certain of our other filings with the Securities and Exchange Commission
contain statements that constitute forward-looking statements within the meaning of the
Securities Act of 1933 and the Securities Exchange Act of 1934 as amended by the Private Securities
Litigation Reform Act of 1995. Prospective investors are cautioned that any such forward-looking
statements are not guarantees of future performance and involve risks and uncertainties, and that
actual results may differ materially from those contemplated by such forward-looking statements. A
number of important factors could cause actual results to differ materially from those contemplated
by the forward- looking statements in this press release and our filings with the Securities and
Exchange Commission. Many of these factors are beyond Synovus ability to control or predict.
Factors that could cause actual results to differ materially from those contemplated in this press
release and our filings with the Securities and Exchange Commission include: (1) further
deterioration in credit quality, particularly in residential construction and development loans,
may continue to result in increased non-performing assets and credit losses, which will adversely
impact our earnings and capital; (2) declining values of residential real estate may result in
further write-downs of assets, which may increase our credit losses and negatively affect our
financial results; (3) continuing weakness in the residential real estate environment may
negatively impact our ability to liquidate non-performing assets; (4) the impact on our borrowing
costs, capital cost and our liquidity due to adverse changes in our current credit ratings; (5) our
ability to manage fluctuations in the value of our assets and liabilities to maintain sufficient
capital and liquidity to support our operations; (6) restrictions or limitations on access to funds
from subsidiaries, thereby restricting our ability to make payments on our obligations or dividend
payments; (7) continuing deterioration in general economic conditions and conditions in the
financial markets; (8) the risk that the allowance may prove to be inadequate or may be negatively
affected by credit risk exposures; (9) changes in the interest rate environment which may increase
funding costs and reduce earning assets yields, thus reducing margins; (10) risks associated with
the concentration of our non-performing assets in certain geographic regions and with affiliated
borrowing groups; (11) the risk that we may be required to seek additional capital to satisfy
applicable regulatory standards and pressures; (12) the risk that, as we pursue alternatives to
bolster our capital position, such capital may not be available to us on favorable terms, if at
all; (13) the impact of recent and proposed changes in governmental policy, laws and regulations,
including proposed and recently enacted changes in the regulation of banks and financial
institutions, or the interpretation or application thereof, including restrictions, increased
capital requirements, limitations and/or penalties arising from banking, securities and insurance
laws regulations and examinations; (14) the impact on Synovus financial results, reputation and
business if Synovus is unable to
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comply with all applicable federal and state regulations and
applicable memoranda of understanding, other supervisory actions and any necessary capital
initiatives; (15) risks associated with litigation; (16) the risk that we will not be able to
complete the proposed charter consolidation or, if completed, realize the anticipated benefits of
the proposed charter consolidation; (17) the volatility of our stock price; (18) the risk that
Synovus could have an ownership change under Section 382 of the Internal Revenue Code, which
could impair Synovus ability to timely and fully utilize net operating losses and built-in losses
that may exist when such ownership change occurs and (19) the other factors set forth in Synovus
filings with the Securities and Exchange Commission, including its
Annual Report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. We
believe these forward-looking statements are reasonable; however, undue reliance should not be
placed on any forward-looking statements, which are based on current expectations. We do not
assume any obligation to update any forward-looking statements as a result of new information,
future developments or otherwise.
Synovus has filed a registration statement (including a prospectus) with the SEC for the common
stock and tMEDS offerings. Before you invest, you should read the prospectus in that registration
statement, the applicable prospectus supplement and other documents that Synovus has filed with the
SEC for more complete information about Synovus and these offerings. You may obtain these documents
for free by visiting the SECs website at www.sec.gov. Alternatively, Synovus, any underwriter or
any dealer participating in the offerings will arrange to send you the prospectus if you request it
by calling toll-free 1-866-430-0686.
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