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December 6, 2009

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Deal to cost another $60 million

Thursday, Sept. 2, 1999 | 11:36 a.m.

SALT LAKE CITY -- Zions Bancorporation and First Security Corp. disclosed a surprise increase in the cost of their merger of about $60 million based on current stock prices.

Both banks operate in Nevada, with Zions owning Nevada State Bank here. In June, Zions announced its intention to acquire the larger bank and retain First Security's name. The stock-for-stock transaction has an estimated value of $5.9 billion, and initially merger costs were estimated at $210 million.

Zions this week said the deal now includes an incurred stock option charge of approximately $60 million and a net increase in common equity of about $36 million.

Standard & Poors bank analyst Tom Smith said that even though the "sizeable (merger cost) increase made me blink, I don't think that anyone will be particularly upset as there will be no long-term effect on either company's stock value."

Separately, First Security announced the acquisition of Salt Lake City-based Cost Control Advocates Inc., an insurance consulting and flexible benefits company operating in Utah, Nevada, Idaho and Wyoming.

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