TierOne shareholders say yes to CapitalSource merger

By Lisa Kerner

Charlotte, N.C., Nov. 29 - TierOne Corp. shareholders approved the company's merger with CapitalSource Inc., according to a statement released on Thursday.

It was previously reported that TierOne investor Private Capital Management, LP, which has a 9% stake in the company, had planned to vote against the deal at the shareholders meeting on Nov. 29 believing that the $34-per-share offer price was inadequate.

CapitalSource agreed to acquire TierOne, which is TierOne Bank's holding company, in a stock and cash transaction valued at about $652 million, or $34.46 per share. The actual value on consummation of the transaction will depend on CapitalSource's share price at closing.

Each TierOne share will be exchanged for $6.80 in cash plus 0.675 of a share of CapitalSource. Stockholders will receive an additional 0.405 of a CapitalSource share if CapitalSource's stock price, based on a 10-day trading period prior to closing, is less than or equal to $25.1852.

CapitalSource said that by approving the transaction, "shareholders of TierOne have recognized the substantial benefits of this merger for the bank, its depositors and its lending customers."

TierOne Bank is a $3.4 billion federally chartered savings bank located in Lincoln, Neb.

CapitalSource is a commercial lending, investment and asset management business based in Chevy Chase, Maryland.

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