TD Bank, First Horizon mutually agree to terminate merger deal

Investing.com -- U.S. lender First Horizon National Corporation (NYSE:FHN) and Canada's TD Bank (TSX:TD) have agreed to end their previously announced $13.4 billion merger, the companies said on Thursday, terminating a deal that had already been facing pressure following the onset of a recent crisis in regional banks.

According to a joint statement, the tie-up, which was originally unveiled in February, was scrapped after TD informed First Horizon that it does not have a timetable to receive regulatory approval. This was due to "reasons unrelated to First Horizon," the firms added.

"Because there is uncertainty as to when and if these regulatory approvals can be obtained, the parties mutually agreed to terminate the merger agreement," the statement said.

Shares in Memphis, Tennessee-based First Horizon slumped by more than 40% in premarket U.S. trading.

Under the terms of the termination agreement, TD will make a $200 million cash payment to First Horizon. In addition, TD - Canada's second-largest bank - will pay $25M that it contractually owed to First Horizon if the deal failed to get the green light from regulators.

Some TD shareholders previously told Reuters last month that the bank should either abandon or renegotiate the deal after the collapse of Silicon Valley Bank in March sparked turmoil in other midsize U.S. lenders.

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