Shareholders voted on Wednesday to remove a restriction on any single entity owning more than 10 percent of Cayman National Corporation Ltd., a move that will allow Republic Bank Trinidad and Tobago (Barbados) Ltd. to finalize its acquisition of the local bank.

Republic Bank is buying 74.99 percent of Cayman National at US$6.25 per share. Cayman National stock was US$3 before the Trinidad bank announced its offer in early August.

The acquisition still requires regulatory approvals in the jurisdictions where Cayman National conducts business: Cayman, the Isle of Man and Dubai. Cayman National CEO Stuart Dack said he does not know an exact timeline for those approvals, but that he expects decisions before the end of this year.

Wednesday’s vote to remove the 10-percent ownership restriction passed with 90.5 percent of shares in favor of the motion. Mr. Dack told the Compass that the landslide decision is a signal that Caymanians support the terms of the sale to the Republic Bank.

Mr. Dack added that Republic Bank has received acceptances from “well above” 75 percent of the local bank’s shares. Since the Trinidad-based bank was only offering to purchase between 51 percent and 74.99 percent of Cayman National, the Republic Bank’s purchases of shares will be determined in accordance with a formula laid out in its offer circular.

Before Wednesday, a similar meeting was held on Oct. 9 to remove a provision in Cayman National’s articles of association that prevented more than 10 percent of its shares from being issued to any entity. That amendment passed with roughly 80 percent of the voting shares in favor of removing the restriction.

However, there was another restriction in the articles stating that the bank’s directors shall decline to register any transfer of shares that result in an entity owning more than 10 percent of Cayman National. That restriction also needed to be removed, but was not voted on at the Oct. 9 meeting due to what Cayman National called “an administrative oversight.”

At the October meeting, a number of shareholders raised objections to having a Trinidadian organization take over Cayman’s only locally owned bank.

“They want this company for a reason. It’s probably because of their image,” businessman A.L. Thompson said of Republic Bank. “But I don’t trust them, I don’t know who they are, and I don’t trust the whole country.”

Mr. Thompson also asked Cayman National’s board of directors whether they negotiated the US$6.25 per share, and what happens if shareholders want to sell at a higher price.

Cayman National chairman Truman Bodden said that the bank received an unsolicited offer from Republic Bank. Cayman National then hired Deloitte to value the business, and it was determined that Republic Bank’s offer of US$6.25 per share was a good price.

With that established, the Cayman National directors were legally bound to bring the offer to the shareholders, Mr. Bodden explained at the October meeting.

Fewer people attended Wednesday’s meeting, but similar objections were raised and similar questions were asked.

Mr. Thompson said he objected to having Cayman National acquired by a foreign entity, but decided to sell his shares after the October meeting because “I don’t want to be in business with those people,” referring to Republic Bank.

He asked again whether shareholders can sell to Republic Bank at a higher price than US$6.25, and Mr. Dack explained again that they cannot.

Another shareholder asked whether Republic Bank intends to acquire the rest of Cayman National shares by compulsion. A circular about the offer states that “if the [Republic Bank] acquires more than two-thirds of Cayman National Shares as a result of the Partial Offer, the [Republic Bank] will have the ability to pass a special resolution approving a statutory merger which may result in the compulsory acquisition of Shares held by minority shareholders, subject to certain conditions.”

Mr. Dack responded that it is Cayman National’s understanding that the Republic Bank does not intend to acquire the minority shares.

“They want to maintain a local holding,” he said.

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