Trustmark Completes Share Repurchases; Hopes to Also Buy Warrant

By Chris Carey, Bailout Sleuth

Trustmark Corp. completed its repurchase of 215,000 shares of preferred stock from the U.S. Treasury on Wednesday. (We noted the plan to repurchase the stock in this post, published last week.)  

The Jackson, Miss.-based company issued the preferred stock to the government in November 2008 in exchange for $215 million from the Troubled Asset Relief Program. Trustmark also gave the Treasury a warrant to buy 1.6 million shares of its common stock.

To redeem the preferred shares, Trustmark repaid the $215 million, plus a final dividend of $7.1 million.

“We believe the repurchase of these preferred shares is in the best interests of our shareholders,” Chairman Richard G. Hickson said in a press release. “Based upon our continued solid profitability and strong capital base, Trustmark remains well positioned to meet the needs of our customers as well as maintain its financial flexibility to take advantage of opportunities for growth and expansion in the marketplace.”

The company will take a one-time, non-cash charge of approximately $8.2 million (or about $0.14 per share) in the fourth quarter to account for the repurchase of the preferred shares.

Trustmark also hopes to repurchase the warrant for the common shares at fair market value. However, as the company notes in its filing with the Securities and Exchange Commission: “…there can be no assurance that Trustmark will reach agreement with the Treasury as to a fair market value of the warrant, or that Trustmark will repurchase the warrant.”

Trustmark has more than 150 offices in Florida, Mississippi, Tennessee and Texas.

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