Miller and Bava Quoted in S&P Global Market Intelligence on Big Poppy and Summit State Bank

Big Poppy faces uphill battle in hostile attempt to buy Summit State Bank shares
– S&P Global Market Intelligence

Manatt Financial Services Leader Craig Miller and Senior Partner Gordon Bava were quoted in an article by S&P Global Market Intelligence on a potential hostile takeover between Big Poppy Holdings and Summit State Bank. 

Big Poppy applied for a “change in control” from the Federal Reserve without asking for a majority interest in Summit, which could mean avoiding some regulatory scrutiny. The public and lengthy nature of a regulatory approval process for a hostile bid presents a challenge, Miller said. 

"The timing imposed by the regulatory process is very challenging for an acquirer who's not been embraced by the target," Miller said. "That's really why you very rarely see these kinds of transactions." 

Regulators do not have a legal basis to reject a takeover and would have to instead have another reason, such as the buyer’s financial conditions, to stop it, Bava said. However because Big Poppy and Summit are competitors in California’s Santa Rosa market, a tie-up could be economically compelling, Bava said.  

"A lot of expenses can be eliminated in an in-market consolidation like this," Bava said. "They could make a strong case to the stockholders that their investment will be worth more in the near term." 

Bava also said a “white knight” buyer could be an alternative to a tie-up. "It's likely that a deal gets done, but not necessarily with Big Poppy,” he said. 

However Summit would have to explore other options before Big Poppy acquires a more significant amount of shares and makes transactions with another party “much more difficult,” Miller said. 

"The path to getting approval from the remaining shareholders may be very challenging," Miller said. "This may be one way to get leverage for themselves to make a negotiated offer and also to discourage others from making negotiated offers for Summit." 

Read the full S&P Global Market Intelligence article here.  



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