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Archive for Thursday, September 26, 1991

LNB PRESIDENT TO SUBMIT NEW BID

September 26, 1991

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The president of Lawrence National Bank said he will be submitting a new purchase offer to buy controlling interest in the local bank.

Terry Sutcliffe said the new offer will be a response to a formal solicitation of bids he received Tuesday from the estate of Robert Brozman. At the time of his death in June, Brozman was the bank's chairman and owned majority interest in Jayhawk Bancshares, the holding company that controls LNB.

Spokesmen for the estate have said that about 40 potential bidders for all seven of the Brozman-controlled banks were on the mailing list for the letter inviting purchase offers.

Sutcliffe submitted an unsolicited bid for the bank last month. Although that offer received no response from Brozman's estate, Sutcliffe has said he isn't concerned because other unsolicited offers tendered by the managements of other Brozman-controlled banks also went unanswered.

SUTCLIFFE, who is representing a group of investors he declines to identify, said the new offer, which is due by Oct. 25, will conform to specific guidelines set forth in the letter.

However, Sutcliffe said his original bid was not far off the price and terms he believes the estate is seeking for LNB.

"I think everything looks fine up to now," he said.

The estate will respond to the bids within 30 days of the Oct. 25 submission deadline, he said.

Sutcliffe also said he still had not heard of other parties planning to make offers on LNB. However, he said the bank will be required to open its books to any parties that might express an interest to allow those potential bidders to conduct "limited due diligence" on the financial condition of the bank.

Sutcliffe emphasized that the information the bank would disclose would be general and statistical in nature and that confidential customer records would not be made available.

SUTCLIFFE has declined to discuss the specifics of his offer to buy the bank and Jack Brozman, executor of his father's estate, has said that details of the letter sent to potential bidders are being kept confidential.

However, spokesmen for the estate have said they expect each of the seven Brozman-owned banks to bring 1.25 times their net worth. That formula would set the price for LNB, which has $6 million in capital, at about $7.5 million.

The banks' future ownership has been a source of speculation since the estate obtained permission from a Johnson County district judge to sell assets to satisfy obligations. The estate's assets are valued in court records at $89.4 million; its debts, which include $23.1 million in business Brozman allegedly diverted for personal and other uses, are reported at $83.6 million.

Other Brozman-controlled banks are Southwest Bank of Topeka; First State Bank of Kansas City, Kan.; Central Bank & Trust of Hutchinson; City Bank & Trust of Wichita; Union National Bank of Elgin, Ill.; and Metropolitan State Bank of Commerce City, Colo.

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