|
Filed
by First Oak Brook Bancshares, Inc.
(Commission
File No. 0-14468)
Pursuant
to Rule 425 under the Securities Act of 1933 and
Deemed
Filed Pursuant to Rule 14a-12 under the Securities Exchange Act
of
1934
Subject
Company: MB Financial, Inc.
(Commission
File No: 0-24566-01)
|
Set
forth
below are presentation materials for First Oak Brook Bancshares, Inc.’s Annual
Shareholders’ Meeting held on May 9, 2006.
and
FIRST
OAK BROOK
BANCSHARES
Creating
the
Leading Chicagoland Franchise
FOBB
Annual
Meeting
May
9,
2006
When
used in this
presentation and in filings with the Securities and Exchange Commission,
in
other press releases or other public shareholder communications, or in
oral
statements made with the
approval of an authorized executive officer, the words or phrases “believe,” “will likely result,” “are
expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are
intended to identify “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking
statements, which speak only as of the date made. These statements may relate to future financial
performance, strategic plans or objectives, revenues or earnings projections, or other financial items.
By their nature, these statements are subject to numerous uncertainties that could cause actual
results to differ materially from those anticipated in the statements.
approval of an authorized executive officer, the words or phrases “believe,” “will likely result,” “are
expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are
intended to identify “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking
statements, which speak only as of the date made. These statements may relate to future financial
performance, strategic plans or objectives, revenues or earnings projections, or other financial items.
By their nature, these statements are subject to numerous uncertainties that could cause actual
results to differ materially from those anticipated in the statements.
Important
factors
that could cause actual results to differ materially from the results
anticipated or projected include, but are not limited to, the following:
(1)
expected cost savings and synergies from
the MB Financial-First Oak Brook merger might not be realized within the expected time frames and
costs or difficulties relating to integration matters might be greater than expected; (2) the requisite
stockholder and regulatory approvals for the MB Financial-First Oak Brook merger might not be
obtained; (3) the credit risks of lending activities, including changes in the level and direction of loan
delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan
losses; (4) competitive pressures among depository institutions; (5) interest rate movements and
their impact on customer behavior and net interest margin; (6) the impact of repricing and
competitors' pricing initiatives on loan and deposit products; (7) the ability to adapt successfully to
technological changes to meet customers' needs and developments in the market place; (8) MB
Financial's ability to realize the residual values of its direct finance, leveraged and operating leases;
(9) the ability to access cost-effective funding; (10) changes in financial markets; (11) changes in
economic conditions in general and in the Chicago metropolitan area in particular; (12) the costs,
effects and outcomes of litigation; (13) new legislation or regulatory changes, including but not limited
to changes in federal and/or state tax laws or interpretations thereof by taxing authorities; (14)
changes in accounting principles, policies or guidelines; (15) MB Financial’s deposit growth and deposit
mix resulting from its new deposit gathering strategy may be less favorable than expected; (16) the
impact of the guidance recently proposed by the federal banking regulators regarding concentrations
in real estate lending; and (17) future acquisitions by MB Financial of other depository institutions or
lines of business.
the MB Financial-First Oak Brook merger might not be realized within the expected time frames and
costs or difficulties relating to integration matters might be greater than expected; (2) the requisite
stockholder and regulatory approvals for the MB Financial-First Oak Brook merger might not be
obtained; (3) the credit risks of lending activities, including changes in the level and direction of loan
delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan
losses; (4) competitive pressures among depository institutions; (5) interest rate movements and
their impact on customer behavior and net interest margin; (6) the impact of repricing and
competitors' pricing initiatives on loan and deposit products; (7) the ability to adapt successfully to
technological changes to meet customers' needs and developments in the market place; (8) MB
Financial's ability to realize the residual values of its direct finance, leveraged and operating leases;
(9) the ability to access cost-effective funding; (10) changes in financial markets; (11) changes in
economic conditions in general and in the Chicago metropolitan area in particular; (12) the costs,
effects and outcomes of litigation; (13) new legislation or regulatory changes, including but not limited
to changes in federal and/or state tax laws or interpretations thereof by taxing authorities; (14)
changes in accounting principles, policies or guidelines; (15) MB Financial’s deposit growth and deposit
mix resulting from its new deposit gathering strategy may be less favorable than expected; (16) the
impact of the guidance recently proposed by the federal banking regulators regarding concentrations
in real estate lending; and (17) future acquisitions by MB Financial of other depository institutions or
lines of business.
First
Oak Brook Bancshares, Inc. does not undertake any obligation to update
any
forward-looking statement to reflect circumstances or events that occur
after
the date on which the forward-looking
statement is made.
statement is made.
Forward
Looking
Statements
2
Additional
Information & Participants in this
Transaction
Additional
Information
MB
Financial will file a registration statement on Form S-4 with the Securities
and
Exchange Commission (the “SEC”) in connection with the proposed
transaction. The registration statement
will include a joint proxy statement of MB Financial and First Oak Brook that also constitutes a
prospectus of MB Financial, which will be sent to the stockholders of MB Financial and First Oak
Brook. Investors and security holders are advised to read the joint proxy statement/prospectus
when it becomes available because it will contain important information. When filed, this document
and other documents relating to the merger filed by MB Financial and First Oak Brook can be
obtained free of charge from the SEC’s website at www.sec.gov. These documents also can be
obtained free of charge by accessing MB Financial’s website at www.mbfinancial.com under the
tab “Investor Relations” and then under “SEC Filings” or by accessing First Oak Brook’s website at
www.firstoakbrook.com under the tab “SEC Filings.” Alternatively, these documents can be
obtained free of charge from MB Financial upon written request to MB Financial, Inc., Secretary,
6111 North River Road, Rosemont, Illinois 60018 or by calling (847) 653-1992, or from First Oak
Brook, upon written request to First Oak Brook Bancshares, Inc., Rosemarie Bouman, 1400
Sixteenth Street, Oak Brook, Illinois 60523 or by calling (630) 571-1050.
will include a joint proxy statement of MB Financial and First Oak Brook that also constitutes a
prospectus of MB Financial, which will be sent to the stockholders of MB Financial and First Oak
Brook. Investors and security holders are advised to read the joint proxy statement/prospectus
when it becomes available because it will contain important information. When filed, this document
and other documents relating to the merger filed by MB Financial and First Oak Brook can be
obtained free of charge from the SEC’s website at www.sec.gov. These documents also can be
obtained free of charge by accessing MB Financial’s website at www.mbfinancial.com under the
tab “Investor Relations” and then under “SEC Filings” or by accessing First Oak Brook’s website at
www.firstoakbrook.com under the tab “SEC Filings.” Alternatively, these documents can be
obtained free of charge from MB Financial upon written request to MB Financial, Inc., Secretary,
6111 North River Road, Rosemont, Illinois 60018 or by calling (847) 653-1992, or from First Oak
Brook, upon written request to First Oak Brook Bancshares, Inc., Rosemarie Bouman, 1400
Sixteenth Street, Oak Brook, Illinois 60523 or by calling (630) 571-1050.
Participants
in this Transaction
MB
Financial, First Oak Brook and their respective directors and executive
officers
may be deemed to be participants in the solicitation of proxies from
stockholders in connection with the proposed
transaction. Information about these participants may be found in the definitive proxy statements
filed with the SEC by MB Financial on March 29, 2006 and by First Oak Brook on April 7, 2006.
These definitive proxy statements can be obtained free of charge from the sources indicated
above. Additional information regarding the interests of these participants may be obtained by
reading the joint proxy statement/prospectus regarding the proposed transaction when it becomes
available.
transaction. Information about these participants may be found in the definitive proxy statements
filed with the SEC by MB Financial on March 29, 2006 and by First Oak Brook on April 7, 2006.
These definitive proxy statements can be obtained free of charge from the sources indicated
above. Additional information regarding the interests of these participants may be obtained by
reading the joint proxy statement/prospectus regarding the proposed transaction when it becomes
available.
3
The
FOBB/MB
Financial Combined Franchise
|
MB
|
FOBB
|
Combined
|
||||||
|
Total
Assets
|
$5.9
Bil
|
$2.3
Bil
|
$8.2
Bil
|
|||||
|
Loans
|
$3.9
Bil
|
$1.4
Bil
|
$5.3
Bil
|
|||||
|
Total
Deposits
|
$4.4
Bil
|
$1.9
Bil
|
$6.3
Bil
|
|||||
|
Total
Equity
|
$501.9
Mil
|
$132.4
Mil
|
$800
Mil
|
|||||
|
Net
Income
for
|
||||||||
|
the
1st qtr
2006
|
$17.1
Mil
|
$3.4
Mil
|
||||||
4
Transaction
Rationale
Strategically
Compelling
Financially
Attractive
n
FOBB
provides MB
Financial with core deposit
funding
for future
commercial loan growth
¾
First
Oak Brook is
one of Chicago’s premier deposit
gatherers
¾
Strong
treasury
management function generates
significant
commercial deposits
n
FOBB
enhances MB
Financial’s branch presence in
highly
attractive
Chicago marketplace
¾
Entry
/ extension
into attractive Western and affluent
Northern
suburbs
¾
Highly
complementary to existing footprint
n
FOBB
significantly
increases MB Financial’s scale
¾
Top
10 presence in
Chicago MSA
n
GAAP
and Cash EPS
accretive
n
IRR
in excess of
15%
n
Achievable,
conservative cost savings assumptions
n
Low-risk
transaction integration
5
and
FIRST
OAK BROOK
BANCSHARES
n
Strong deposit
gathering expertise
¾
12+%
annual core
deposit growth
n
Proven
de novo
branching success
n
Top
5 deposit
market share in DuPage
County
n
Leading
treasury
management
products
and
service
n
Solid
expense
control
n
Strong
credit
quality
n
Proven
asset
generation capability
¾
16%
annual
commercial loan growth
n
Proven
and
disciplined acquisition partner
n
Top
10 deposit
market share in Cook County
n
High
quality
leasing business
n
Valuable
ethnic
banking niches
¾
Korean,
Ukrainian,
Polish
n
Increasing,
stable
and consistent earnings
n
Strong
credit
quality
n
Strong
earning
asset growth supported by equally strong organic deposit
growth
n
Distinctive
and
valuable branch network (61 offices and growing)
n
Top
5 competitor in
middle-market commercial banking segment
n
Top
10 Chicago MSA
deposit market share
n
Enhanced
scale in
treasury management, merchant processing, asset
management,
trust,
private client services and leasing business lines
Compelling
Strategic Rationale
6
n
61
full-service
branches in
Chicagoland
n
Highly
desirable
and
complementary
branch network
n
#9
in deposit
market share in
the
Chicago
MSA
n
#3
in deposit
market share in
the
DuPage
MSA
n
Excellent
coverage
of middle-
market
business
locations
Source:
SNL
Financial. Data as of 30-Jun-2005.
The
FOBB/MB
Financial Combined Franchise
7
Chicago
Deposit
Market Share
MSA:
Chicago-Naperville-Joliet, IL-IN-WI
Source:
SNL Financial at 6/30/05
|
Rank
|
Institution
|
Type
|
Branch
Count
|
Total
Deposits
in
Market
($000)
|
Total
Market
Share (%) |
|
1
|
JP
Morgan
Chase & Co. (NY)
|
Bank
|
339
|
38,406,892
|
16.03
|
|
2
|
LaSalle
Bank
Corporation (IL)
|
Bank
|
142
|
30,956,884
|
12.92
|
|
3
|
Harris
(Bank
of Montreal)
|
Bank
|
196
|
23,500,697
|
9.81
|
|
4
|
Northern
Trust Corp. (IL)
|
Bank
|
18
|
8,461,138
|
3.53
|
|
5
|
Fifth
Third
Bancorp (OH)
|
Bank
|
123
|
8,052,445
|
3.35
|
|
6
|
Wintrust
Financial Corp. (IL)
|
Bank
|
68
|
6,460,053
|
2.70
|
|
7
|
Charter
One
(RBS Group)
|
Bank
|
133
|
6,446,076
|
2.69
|
|
8
|
MAF
Bancorp
Inc. (IL)
|
Thrift
|
60
|
5,628,954
|
2.35
|
|
9
|
Combined
FOBB/MB
|
Bank
|
61
|
5,584,795
|
2.33
|
|
10
|
Corus
Bankshares Inc. (IL)
|
Bank
|
14
|
5,500,178
|
2.29
|
|
Totals
|
263
|
3,071
|
239,666,690
|
0.67
|
DuPage
County
Market Share
|
In
DuPage
|
|||||
|
Rank
|
Institution
|
#
Offices
|
($million)
Deposits
|
%
Market
Share |
|
|
1
|
J
P Morgan
Chase
|
41
|
3,141
|
13.24%
|
|
|
2
|
Harris
(Bank
of Montreal)
|
23
|
2,493
|
10.51%
|
|
|
3
|
Combined
FOBB/MB
|
13
|
1,595
|
6.72%
|
|
|
4
|
Mid
America
Bank
|
13
|
1,511
|
6.37%
|
|
|
5
|
Fifth
Third
|
17
|
1,411
|
5.60%
|
|
|
6
|
Lasalle
(ABN
Amro)
|
20
|
1,329
|
5.57%
|
|
|
7
|
West
Suburban
Bank
|
26
|
1,321
|
5.57%
|
|
|
8
|
Charter
One
(RBS)
|
22
|
1,197
|
5.05%
|
|
|
9
|
Wintrust
|
7
|
711
|
3.00%
|
|
|
10
|
US
Bank
|
12
|
601
|
2.54%
|
|
|
Total
of 72
Banks
|
373
|
$23,723
|
|||
Source:
SNL Financial at 6/30/05
9
Low
Execution/Integration Risk
Low
execution/integration risks with MBFI as your partner
¾
MB’s
Proven merger
capabilities
§
Successful
track
record – 19 transactions completed since 1990
§
M&A
skills
recognized by investor community
¾
MB’s
Experienced
at complex integrations
§
Collaborative
approach
§
Open,
accepting
culture – lowers staff risk
¾
Similar
business
philosophies and strategies
¾
Integration
without distractions. MBFI has no other pending
acquisitions.
¾
Reputation
for
treating partners fairly
¾
Excellent
regulatory relations; outstanding CRA rating
10
Transaction
Summary
Consideration
Per Share: $36.80
in value per First Oak Brook share*
Transaction
Value: $372mm
Consideration
Mix:
80%
stock /
20% cash
Form
of
Consideration: Fixed
number of MB
Financial shares of approximately 8.4 million**
Fixed
cash amount of approximately $74
million**
Stock
/
Cash
Election: Shareholders
to elect between common stock or cash subject to
proration
MB
Financial Dividend: Commitment
to increase to $0.18/share quarterly (post-closing)
First
Oak
Brook
Ownership: 23%
(fully diluted)
Board
Seats: 1
to Richard
Rieser (First Oak Brook CEO)
1
to Charles Gries
(First Oak Brook independent director)
Cost
Savings:
$12.6mm (pre-tax)
GAAP
EPS
Accretion:
2007 2.2%
2008 4.0
Due
Diligence:
Complete
Approvals:
Regulatory; First Oak Brook and MB Financial
shareholders
Expected
Closing:
4th Quarter
2006
*
Based on
average MB Financial closing price during five-trading day period ended
April
28, 2006.
**
Excludes
common stock equivalents.
11
Transaction
Value
Between Announcement and Close
-10%
-8%
+10%
+8%
MBFI
Stock Value at
Close
$35.00
$36.00
$37.00
$38.00
$39.00
$40.00
$41.00
$42.00
$43.00
$44.00
Per
Share Amount
$36.43
$37.26
$38.09
$38.92
$39.75
$40.58
$41.41
$42.24
$43.07
$43.90
12
MBFI
Price
Performance
Total
Return(1):
YTD: 7.48% 1 Year:
3.92% 3 Year:
16.20%
5
Year:
25.08%
Three
Year
Average Daily Volume: 62,795
Source:
Fact
Set.
(1)
Source:
Bloomberg, LP; assumes reinvestment of dividends in security. As of close
5/4/2006.
13
and
FIRST
OAK BROOK
BANCSHARES
Creating
the
Leading Chicagoland Franchise
FOBB
Annual
Meeting
May
9,
2006
14