Allied First Bancorp Being Acquired... But at What Price? $AFBA

We have mentioned Allied First Bancorp (AFBA) in the Oddball Stocks Newsletter and on the blog:

• Oddball Stocks Newsletter Excerpt: Allied First Bancorp from Issue 36
• Oddball Stocks Newsletter Excerpt: Allied First Bankcorp from Issue 33
  

Here is what we said in Issue 36:

AFBA is a standout as a very small bank with a very high return on equity that trades at a 12% discount to tangible book value as of June 30, 2021. Based in Oswego, Illinois (southwest Chicago exurbs), it started as a credit union for American Airline pilots in 1994 and converted in 2000. Our guest writer Catahoula first mentioned it in Issue 26 (August 2019) at $1 so it has returned 8.5x since. The current market capitalization is $16 million at $8.50 per share which is 88% of TBV. (We use a 1,911,892 total share count which assumes that 139,995 shares of convertible preferred stock that were issued under TARP are converted to common.)

We just found out that AFBA is being acquired:

ServBanc Holdco, Inc., Phoenix, Arizona; to become a bank holding company by merging with Allied First Bancorp, Inc., and thereby indirectly acquiring Allied First Bank, SB, both of Oswego, Illinois.

As Phil Timyan was first to notice, the company did not put out a press release. Nor did the acquirer. So, there is no information about price and terms available for shareholders or investors.

Phil also pointed out that the lack of communication was "about what you'd expect from a guy still around from a $10 2001 conversion that almost failed."

We did some digging. The "Executive Vice President - Chief Financial Officer" of the bank is Mark A. Fritz. His email is mfritz@alliedfirst.com and his phone number is 630-383-0102, but he didn't answer the phone.

Next we tried to get a hold of President Ken Bertrand, but we couldn't get a hold of him at the office either. His email is kbertrand@alliedfirst.com and he can be reached via the main switchboard at 630-554-8899.

One of our Oddballs got in touch with the Chairman of the bank, John Maxwell, who is a real estate agent in Hawaii. This Oddball found out from Mr. Maxwell that the deal price is estimated to be $11-12 per share. The bank is refusing to give any more details about the merger besides this, but has said that a proxy statement for the merger is "in the mail."

So, if that information about the deal price is accurate, this AFBA idea will have returned 11x since it was mentioned in the Newsletter in 2019!