Huntington and TCF complete merger, ink $12.5M deal for Torgow
Huntington and TCF banks announced Wednesday that they have officially closed their merger, setting in motion the planned rebranding of TCF as Huntington Bancshares and the anticipated renaming of TCF Center in downtown Detroit.
The closure of the all-stock deal also includes a three-year, $12.5 million advisory deal for Gary Torgow, the previous executive chairman of Detroit-based TCF Bank who now joins Huntington's newly enlarged board of directors, and whose five adult children will be landlords of the bank's new commercial banking headquarters in Detroit that is under construction, according to Securities and Exchange Commission documents.
TCF's merger into Huntington was first announced in December and received final approvals late last month from federal regulators, on the condition it sell 14 TCF branches in Michigan to a different bank for antitrust reasons. Horizon Bank has a tentative deal to buy all of those branches.
In total, the post-merger Huntington bank will be a top 25 U.S. bank holding company with $142 billion in deposits, $116 billion in loans and more than 1,100 branches in multiple states. As part of the merger, 189 branches in Michigan and Ohio are closing, including all of Huntington's in-store Meijer bank locations in Michigan.
TCF customer accounts will be converted to Huntington's systems in the fourth quarter and Huntington customers will not be impacted by the conversion.
The TCF Center in downtown Detroit, formerly known as Cobo Hall, will be renamed sometime this summer or fall, according to statements by Stephen Steinour, chairman and CEO of Huntington, in an interview with Crain's Detroit.
The new Huntington is to have dual headquarters: its main headquarters in Columbus, Ohio, and a commercial banking headquarters in Detroit, inside the new 20-story downtown tower that is under construction.
"We are pleased to announce the completion of this combination with TCF and look forward to welcoming our new colleagues and customers to Huntington," Steinour said in a news release. "We also look forward to strengthening our community impact through the combined bank."
Torgow, once a high-profile Detroit real estate executive, was a founder and chairman of the old Talmer Bank that absorbed numerous other banks, including former Midland-based Chemical Bank, and ultimately grew to become TCF Bank.
Torgow is now an adviser to Huntington until the third anniversary of the merger's consummation in 2024. He is to get a total $12.5 million for this role, including a $3.5 million lump sum in cash, $3.5 million on the first and second anniversaries of the merger's effective date and $2.75 million on the third anniversary. Those are the only payments Torgow is to receive for his service.
The SEC filings also give updated terms of Torgow's children's development and landlord deal for the new 20-story downtown Detroit building, 2047 Woodward Ave. near Comerica Park, that is expected to open next year.
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This family connection was previously disclosed, and corporate governance experts haven't voiced any concerns about it.
The five adult Torgow children own 50% of the corporate entity that is the building's developer, general contractor and future landlord for Huntington. That entity, called GPC Adams, is an affiliate of the Detroit-based real estate firm Sterling Group that Gary Torgow co-founded in the late 1980s and severed personal and financial ties with in 2009.
Bank officials either didn't respond or answer past Free Press inquiries about who owns the other 50%, although they told Crain's Detroit that the owner is New York businessman Sol Werdiger, a friend of Gary Torgow's. A message left Wednesday for Werdiger wasn't immediately returned.
Once the new building is done, GPC Adams is to charge what are currently top-of-the-market rents to Huntington of $35 per square foot for office space, or $6.9 million annually, and $50 per square foot for retail space. The triple net lease begins January 2022 and rent rates are to increase 2% annually during the 22½-year term, which can be renewed.
The lease includes 311 parking spaces in the new building at an estimated monthly cost of $300 per spot, or $1.1 million annually.
A Huntington representative declined comment Wednesday.
ContactJC Reindl at313-222-6631 or firstname.lastname@example.org. Follow him on Twitter @jcreindl. Read more on business and sign up for our business newsletter.