Triumph Bancorp (TBK) is a financial holding company headquartered in Dallas, Texas and registered under the BHC Act.
Ten other companies are scheduled for the week of Nov. 3, 2014. The full IPO calendar is available at IPOpremium.
Manager, Joint-managers: Sandler ONeill & Partners, Evercore Group, and Wells Fargo
Co-managers: Keefe, Bruyette & Woods, and Nomura
End of lockup (180 days): Wednesday, May 6, 2015
End of 25-day quiet period: Tuesday, December 2, 2014
TBK scheduled a $101 million IPO with a market capitalization of $249 million at a price range midpoint of $15 for Friday, Nov. 7, 2014 on Nasdaq.
Triumph Bancorp IPO Report
Summary
TBK is a financial holding company headquartered in Dallas, Texas and registered under the BHC Act
Valuation
Valuation Ratios |
Mrkt Cap (mm) |
Price /Net interest income |
Price /Erngs |
Price /BkVlue |
Price /TanBV |
% offered in IPO |
12 mos ended June '14 |
||||||
Triumph Bancorp (TBK) |
$249 |
3.9 |
13.1 |
1.1 |
1.3 |
41% |
SCORECARD |
. |
Mgt |
Market |
Market Do- |
Proprie- |
Total |
1-5, 5 is high |
. |
. |
Grwth |
mination |
tary |
rating |
20 is perfect |
. |
2 |
1.5 |
2 |
1.5 |
C+, 7 |
Conclusion
Neutral
P/E pf 13.1
1.1 times book
Price to net interest income of 3.9
Business
TBK is a financial holding company headquartered in Dallas and registered under the BHC Act.
Through its two wholly owned bank subsidiaries, Triumph Savings Bank and Triumph Community Bank, TBK offers traditional banking products as well as commercial finance products to businesses that require specialized and tailored financial solutions.
TBK’s banking operations include a full suite of lending and deposit products and services focused on its local market areas.
These activities generate a stable source of core deposits and a diverse asset base to support TBK’s overall operations.
TBK’s commercial finance products include factoring, asset-based lending, equipment lending and healthcare lending products offered on a nationwide basis.
These product offerings supplement the asset generation capacity in TBK’s community banking markets and enhance the overall yield of its loan portfolio, enabling TBK to earn attractive risk-adjusted net interest margins.
TBK believes its integrated business model distinguishes it from other banks and non-bank financial services companies in the markets in which TBK operates.
TBK ‘s business is conducted through three reportable segments (Banking, Factoring and Corporate). For the six months ended June 30, 2014, TBK’s banking segment generated 72% of its total interest and noninterest income, its factoring segment generated 27% of its total interest and noninterest income and its corporate segment generated 1% of its total interest and noninterest income. As of June 30, 2014, TBK had consolidated total assets of $1.4 billion, total loans held for investment of $939.5 million, total deposits of $1.1 billion and total stockholders’ equity of $140 million.
Competition
TBK competes with a wide range of regional and national banks located in its market areas as well as non-bank commercial finance and factoring companies on a nationwide basis.
TBK experiences competition in both lending and attracting funds from commercial banks, savings associations, credit unions, consumer finance companies, pension trusts, mutual funds, insurance companies, mortgage bankers and brokers, brokerage and investment banking firms, non-bank lenders, government agencies and certain other non-financial institutions.
5% shareholders pre-IPO
Triumph Consolidated Cos., LLC 14.87%
R-J Real Estate (GP) LLC 7.18%
Carlos M. Sepulveda, Jr. 18.43%
Aaron P. Graft 15.32%
Richard L. Davis 16.65%
C. Todd Sparks 17.17%
Justin Trail 15.32%
Robert Dobrient 15.26%
Charles Anderson 15.38%
Dividends
No dividends are planned.
Use of proceeds
TBK expects to receive $90 million from its IPO and use it for the following:
$25.9 million of the net proceeds to it generated by this offering to redeem, as promptly as practicable following the completion of this offering, TBK’s TARP preferred stock; approximately $11.7 million of the net proceeds of this offering to retire, as promptly as practicable following the completion of this offering,
its senior secured indebtedness, consisting of a senior secured note with a principal amount of $11.9 million as of June 30, 2014, which has an interest rate based at the prime rate with a minimum interest rate of 4.5%, a prepayment penalty of 1.0% of the unpaid principal, and matures on October 15, 2018; and any remainder of the net proceeds of this offering (which will be approximately $52.9 million) to support its organic growth and other general corporate purposes, including potential future acquisitions of bank and non-bank financial services companies that TBK believes are complementary to its business and consistent with its growth strategy.