We are investigating whether First Horizon Corporation (NYSE: FHN) (“FHN”) and The Toronto-Dominion Bank (NYSE: TD) (“TD Bank”) violated federal securities laws in light of a May 8, 2023 article in The Wall Street Journal citing sources alleging that the proposed acquisition of FHN by TD Bank was terminated because regulators were reluctant “to give TD a clean bill of health on its anti-money-laundering practices.”
If you suffered losses as a result of the recent drop in the price of FHN stock following termination of the deal with TD Bank, and have questions about your legal rights, please complete and submit the form below to discuss your options at no charge.
Why is there an investigation?
On February 28, 2022, FHN and TD Bank announced that TD Bank had agreed to acquire FHN for $25.00 in cash per share of FHN common stock (the “Transaction”).
On May 31, 2022, FHN announced that its stockholders had approved the Transaction.
On February 9, 2023, FHN and TD Bank announced that they had mutually agreed to extend the deadline to close the Transaction from February 27, 2023, to May 27, 2023. The announcement indicated that approvals from regulatory authorities in the United States and Canada were required to close the Transaction.
On March 1, 2023, in its 2022 Form 10-K, FHN advised that (i) receipt of regulatory approval of the Transaction was taking longer than originally anticipated, (ii) TD Bank had recently informed FHN that TD Bank did not expect to receive the necessary regulatory approvals in time to close the Transaction by the new deadline of May 27, 2023, and (iii) TD Bank had initiated discussions with FHN regarding a potential further extension of the May 27, 2023 deadline.
On April 12, 2023, TD Bank CEO Bharat Masrani spoke at a luncheon sponsored by Bank of America. According to a note on Masrani’s comments at the luncheon published on April 13, 2023 by analyst Ebrahim H. Poonawala, TD Bank management remained “committed to completing the FHN deal.”
On May 3, 2023, according to a Capital Forum being circulated among traders, TD Bank CEO Bharat Masrani had a meeting with officials of the Office of the Comptroller of the Currency concerning the Transaction in early March that was also attended by TD Bank’s outside counsel.
Upon this news, FHN’s stock price dropped 7.04% in trading on May 3, 2023.
On May 4, 2023, before the markets opened, TD Bank and FHN announced that they had mutually agreed to terminate the Transaction because TD Bank “does not have a timetable for regulatory approvals to be obtained for reasons unrelated to First Horizon,” and “there is uncertainty as to when and if these regulatory approvals can be obtained.”
Upon this news, FHN’s stock price dropped 33.16% in trading on May 4, 2023.
On May 8, 2023, The Wall Street Journal published an article citing sources alleging that TD Bank’s “handling of suspicious customer transactions was behind regulators’ refusal to bless” the Transaction, and that the Transaction was terminated because regulators were reluctant “to give TD a clean bill of health on its anti-money-laundering practices.” The article’s sources alleged that “regulators’ concerns stemmed from the way TD handled unusual transactions in recent years, and the speed at which some of them were brought to the attention of U.S. authorities.”