FILED BY THE PNC FINANCIAL SERVICES GROUP, INC.
PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933 AND
DEEMED FILED PURSUANT TO RULE 14A-12 OF THE SECURITIES EXCHANGE ACT OF 1934
SUBJECT COMPANY: RIGGS NATIONAL CORPORATION
COMMISSION FILE NO. 000-09756
On February 10, 2005, The PNC Financial Services Group, Inc. ("PNC") and Riggs
National Corporation ("Riggs") jointly issued the attached press release
relating to the proposed acquisition by PNC of Riggs.
* * * * * *
PNC and Riggs Announce Revised Merger Agreement
PITTSBURGH and WASHINGTON, Feb. 10 /PRNewswire-FirstCall/ -- The PNC Financial
Services Group, Inc. (NYSE: PNC) and Riggs National --- Corporation (Nasdaq:
RIGS) today announced that, as a result of their renewed negotiations, they have
amended and restated the ---- agreement for PNC to acquire Riggs. Under the
terms of the amended agreement, PNC will acquire Riggs for $20.00 per common
share, or approximately $652 million.
"We are looking forward to our entry into the extremely appealing Washington,
D.C. marketplace, and we are confident that the Riggs franchise will provide us
with an excellent platform from which to grow," said James E. Rohr, chairman and
chief executive officer of The PNC Financial Services Group. "We have assessed
the remaining risks to Riggs, and we believe we have reached a revised agreement
that is fair to all parties."
PNC expects the financial impact of the transaction, including the anticipated
internal rate of return and the impact on PNC's earnings per share, not to
differ materially from previously announced expectations regarding the original
transaction structure.
Under the restated terms of the merger agreement, which has been approved by the
boards of directors of both companies, Riggs National Corporation will merge
into The PNC Financial Services Group, Inc. and PNC Bank N.A. will acquire the
assets of Riggs Bank N.A. This change in structure was effected to mitigate the
potential business impact of Riggs Bank's plea agreement with the Department of
Justice.
The amended agreement, which is substantially similar to the original agreement,
values each share of Riggs common stock at approximately $20.00 based on PNC's
closing NYSE stock price of $54.58 on February 7, 2005. The aggregate
consideration is composed of a fixed number of approximately 6.4 million shares
of PNC common stock and $286 million in cash in exchange for all 31.8 million
Riggs common shares outstanding, subject to adjustment. Riggs stock options,
currently with an aggregate in-the-money value of approximately $16 million,
will be cashed out prior to closing, if not exercised. Riggs has agreed to
dismiss its recently filed lawsuit against PNC.
The transaction is expected to close as soon as possible, and either party may
terminate the agreement after May 31, 2005 if the transaction has not closed.
The merger remains subject to customary closing conditions, including regulatory
approvals and the approval of Riggs shareholders, the receipt of exemptions from
the Department of Labor and the SEC to mitigate the potential business impact of
Riggs Bank's plea agreement with the Department of Justice and the absence of an
undisclosed material adverse effect after December 31, 2004. Mr. Joe L.
Allbritton's agreement to vote 24.6% of the outstanding shares of Riggs in favor
of the transaction remains applicable.
Sandler O'Neill & Partners L.P. acted as the financial advisor to PNC and
Wachtell, Lipton, Rosen & Katz acted as its legal advisor. Lehman Brothers, Inc.
acted as the financial advisor to Riggs and Sullivan & Cromwell LLP acted as its
legal advisor.
FORWARD-LOOKING STATEMENT
This press release contains forward-looking statements reflecting PNC's outlook
or expectations with respect to the planned acquisition of Riggs, the expected
costs to be incurred in connection with the acquisition, Riggs's future
performance, and the consequences of the integration of Riggs into PNC.
Forward-looking statements are subject to numerous assumptions, risks and
uncertainties, which change over time. The forward-looking statements in this
press release speak only as of the date of this press release, and PNC assumes
no duty and does not undertake to update them.
In addition to factors previously disclosed in PNC's SEC reports (accessible on
the SEC website at http://www.sec.gov and on PNC's website at http://www.pnc.com
) applicable to PNC's business generally (including, upon the acquisition, those
aspects currently operated by Riggs), the forward-looking statements in this
press release are subject to the following risks and uncertainties:
* Completion of the transaction is dependent on, among other things, receipt of
stockholder and regulatory approvals, the timing of which cannot be predicted
with precision at this point and which may not be received at all.
* The benefits to PNC of the transaction also depend on the nature of any future
developments with respect to Riggs's regulatory and legal issues, the ability to
comply with the terms of all current or future requirements, including any
related action plan, resulting from these issues, and the extent of related
costs.
* The transaction may be materially more expensive to complete than anticipated
as a result of unexpected factors or events.
* The integration of Riggs's business and operations into PNC, which will
include conversion of Riggs's different systems and procedures, may take longer
than anticipated or be more costly than anticipated or have unanticipated
adverse results relating to Riggs's or PNC's existing businesses.
* The anticipated cost savings of the acquisition may take longer to be realized
or may not be achieved in their entirety.
* The anticipated benefits to PNC are dependent in part on Riggs's business
performance in the future, and there can be no assurance as to actual future
results, which could be impacted by various factors, including the risks and
uncertainties generally related to PNC's and Riggs's performance (with respect
to Riggs, see Riggs's SEC reports, also accessible on the SEC website) or due to
factors related to the acquisition of Riggs and the process of integrating it
into PNC.
ADDITIONAL INFORMATION ABOUT THIS TRANSACTION
The PNC Financial Services Group, Inc. and Riggs will file an amended proxy
statement/prospectus and other relevant documents concerning the merger with the
United States Securities and Exchange Commission (the "SEC"). WE URGE INVESTORS
TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER DOCUMENTS TO BE FILED WITH
THE SEC IN CONNECTION WITH THE MERGER OR INCORPORATED BY REFERENCE IN THE PROXY
STATEMENT/PROSPECTUS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors
will be able to obtain these documents free of charge at the SEC web site (
http://www.sec.gov ). In addition, documents filed with the SEC by The PNC
Financial Services Group, Inc. will be available free of charge from Shareholder
Relations at (800) 843-2206. Documents filed with the SEC by Riggs will be
available free of charge from http://www.riggsbank.com.
The directors, executive officers, and certain other members of management of
Riggs may be soliciting proxies in favor of the merger from its shareholders.
For information about these directors, executive officers, and members of
management, shareholders are asked to refer to Riggs's most recent annual
meeting proxy statement, which is available on Riggs's website
(http://www.riggsbank.com ) and at the addresses provided in the preceding
paragraph.
Riggs Bank N.A. is the primary operating subsidiary of Riggs National
Corporation (Nasdaq: RIGS), the largest bank holding company headquartered in
the nation's capital. Riggs commands the largest market share in the District of
Columbia and specializes in banking and financial management products and
services for individuals, nonprofit organizations and businesses.
The PNC Financial Services Group, Inc. is one of the nation's largest
diversified financial services organizations, providing regional community
banking; wholesale banking, including corporate banking, real estate finance and
asset-based lending; wealth management; asset management and global fund
services.