BIRMINGHAM (ALABAMA) (dpa-AFX) - Regions Financial Corp. (RF) announced that it has entered into a stock purchase agreement to sell Morgan Keegan & Company, Inc. and related affiliates to Raymond James Financial Inc. (RJF) for $930 million.
As part of the transaction, Morgan Keegan will also pay Regions a dividend of $250 million before closing, pending regulatory approval, resulting in total proceeds of $1.18 billion to Regions, subject to adjustment.
The transaction is anticipated to close during the first quarter, subject to regulatory approvals and customary closing conditions. Morgan Asset Management and Regions Morgan Keegan Trust are not included in the sale and will remain part of Regions' Wealth Management organization, Regions Financial said.
As a result of the process of selling Morgan Keegan, Regions expects to record an impairment charge in a range of $575 million to $745 million in the fourth quarter of 2011 related to the $745 million of goodwill included in its Investment Banking/Brokerage/Trust segment.
Regions now expects to record a net loss available to common shareholders for the fourth quarter of 2011 in a range of $432 million to $633 million or $0.34 per share to $0.50 per share. Net loss from Continuing Operations is expected to be in a range of $101 million to $197 million or $0.08 to $0.16 per common share. Net income from Continuing Operations without the goodwill impairment charge is expected to be in a range of $88 million to $119 million or $0.07 to $0.09 per common share.
Analysts polled by Thomson Reuters expect the company to report earnings of $0.05 per share for the fourth-quarter. Analysts' estimates typically exclude special items.
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