Horizon Bancorp in Michigan City, Ind., is planning to sell common stock.
The $7.7 billion-asset company disclosed in a slide presentation that it plans to sell at least $90 million of stock. Horizon said in a press release that it expects to grant its underwriters a 30-day option to buy up to an additional 15% of the shares.
The company also plans to issue about $100 million of subordinated debt.
Horizon said it could use proceeds to reposition its balance sheet if the offering “is completed on terms that are satisfactory to us and if market conditions are satisfactory to us.”
Horizon said it plans to redeem $56.5 million of sub debt due in 2030 and reclassify securities with an amortized cost basis of roughly $1.8 billion. The reclassification will result in an unrealized after-tax loss of about $218.8 million.
The company plans to sell securities with an amortized cost basis of about $1.7 billion, with an expected after-tax loss of roughly $238.4 million. Horizon also plans to sell indirect auto loans with an amortized cost basis of about $200.8 million, which should result in an after-tax loss of about $4.3 million.
Horizon also plans to repay about $700 million of FHLB advances with an estimated after-tax prepayment penalty of $12 million. Horizon plans to runoff about $400 million of transactional public deposits.
The company expects to buy about $617.8 million of new securities.
Keefe, Bruyette & Woods and Performance Trust Capital Partners are the offering’s joint book-running managers.