CIB Marine Agrees Buyback Plan with Hildene Capital

CIB Marine Bancshares has agreed a share buyback plan after being targeted by activist investor Hildene Capital.

The company has also postponed its annual meeting for three weeks to allow it time to seek regulatory approvals, finalize negotiations, and document the repurchase plan.

In a letter to shareholders, CIB Marine announced the agreement “in principle” with Hildene Capital Management and Hildene Opportunities Master Fund I, which holds 4.9% of the bank’s shares.

Under the agreement, CIB Marine will repurchase all of its preferred stock over the next four years.

It comes after Hildene Capital called for an overhaul of the company and nominated John Scannell and Raymond Tellini to be elected to the board.

Hildene Capital said in a letter to CIB shareholders earlier in April that it had “witnessed firsthand” the “decade-long mismanagement of the company marred by underperformance and unfulfilled promises”.

Brian Chaffin, president and CEO of CIB Marine, said that reaching an agreement on a preferred stock repurchase plan was an “important step forward”.

He added: “We believe essential terms have been agreed to and look forward to documenting the definitive agreement and getting regulatory approvals for the 2021 repurchases.

“We appreciate the efforts of all parties that have worked toward a fair and reasonable resolution, which we believe will benefit CIB Marine and all of its shareholders.”

The postponed annual meeting is now due to take place on May 19, 2021, but CIB Marine said that should it receive all required regulatory approvals and a definitive agreement be executed by all parties, the meeting would be further rescheduled for a later date.