Greensboro bank offers bid for Mechanics & Farmers

M&F BANCORP

Greensboro-based Triad Bank is offering a competing deal to acquire Durham-based M&F Bancorp, which reaffirmed its recommendation to shareholders that it merge with Optus Financial Corporation of Columbia, S.C.

The parent company of Mechanics & Farmers Bank reaffirmed support for a merger with Optus Financial Corporation despite a rival bid.

Durham-based M&F Bancorp announced on Oct. 19 that its board of directors unanimously reaffirmed its recommendation that shareholders approve a merger deal with Optus Financial Corporation, the Columbia, S.C.-based holding company of Optus Bank. Another suitor, Greensboro-based Triad Business Bank, confirmed last week it has made an offer for M&F Bancorp. 

An M&F-Optus merger would create the nation’s largest Black-owned bank in terms of assets with $1.27 billion in total assets as of March 31. M&F, which has a Charlotte branch, was founded in 1907. Under terms of the deal, which is expected to exceed $105 million, M&F’s eight branches will operate under its current name for two years before transitioning to Optus. 

“Our Board has given every one of Triad’s proposals a careful and fair review, and each time we reached the same conclusion — the contemplated merger with Optus is the best outcome for our shareholders,” M&F Bancorp chairman James Stewart said in a statement. “Our Board remains unanimous in its support of the Optus merger, and we urge shareholders to vote FOR it.”

Triad Bank, which had $536 million in assets on June 30, made proposals to M&F’s board starting Aug. 6 that would maintain M&F Bancorp status as the holding company, its own charter and name, as well as add Triad as a second bank subsidiary, said Triad director Jonathan Kelly. M&F’s board declined each proposal in writing without meeting Triad officials, he said.

“M&F’s shareholders are being asked to vote on (Oct. 20) on one offer without being told the terms of the other,” he said. “We have put our proposal in front of the M&F Board four times. … We are putting it in front of the people who own the company, in full, next to M&F’s own words.”

Triad has made four written proposals since Aug. 6, Kelly said, the most recent sent on Oct. 8, with an offer of $53.50 in cash at closing for up to 25% of M&F's shares, or 1.25 shares of M&F Bancorp. Optus’ proposal provides up to $46.57 at closing and another $6.73 if the Series E preferred stock is redeemed. M&F's shareholders did not approve the Optus agreement on Oct. 7 and were scheduled to meeting reconvene on Oct. 20. Under Triad's proposal, M&F Bancorp remains the holding company, governed by a majority-Black board. 

M&F's board reviewed Triad’s proposal on Oct. 14, Kelly said, and didn’t describe terms to its shareholders.

“Triad has made four proposals. The last one pays more cash at closing on the shares that take cash, up to one in four, than the Optus agreement provides on any share, and lets the rest stay owners of M&F, with its name, its charter and its Durham home office kept,” Kelly said. “On Oct. 7 the people who own M&F did not approve the agreement. A board that takes a fresh look when the facts change is not reversing itself; it is doing what its shareholders elected it to do.”

M&F officials contend Triad’s value claims are based on projections that depend on a future Nasdaq listing and Triad’s share price has declined by more than 30% since its launch, which they consider below standard. 

“For more than a century, M&F has been defined by our commitment to the communities we serve, and our combination with Optus advances that mission,” President and CEO James Stills said. “Together, we will form the largest African American-owned financial institution in the United States and believe that we will be positioned from day one to expand access to capital and economic opportunity across the Carolinas. Our management teams are already planning for integration, all necessary regulatory applications have been submitted, and the support we have heard from customers, community groups and shareholders has been overwhelming. It is time to complete the process and move forward.”

Triad counters it has posted a profit every quarter since 2025 and has a loan book of about $407 million as of June 30, compared to M&F’s $273 million. Triad’s stock, issued at $10, trades at $6.42.

The combined company would have about $1 billion in assets and $107 million of tangible common equity at closing, registers its stock and seeks a Nasdaq listing.

“M&F was built in 1907 by people who were told no and decided to build a place that said yes,” Kelly said. “Keeping that institution whole, with its charter, its name and its board, is not sentiment. It is the point of the proposal.”

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