DEFM14A: Pinnacle & Synovus Merge into Newco in $8.6B Deal

Pinnacle Financial Partners and Synovus Financial Corp. announce an $8.6 billion all-stock merger, forming a new entity, Newco, with former Pinnacle shareholders owning 51.5%.

Summary

• Pinnacle Financial Partners, Inc. and Synovus Financial Corp. are merging into a newly formed Georgia corporation, Steel Newco Inc., which will be renamed Pinnacle Financial Partners, Inc.
• The merger is an all-stock transaction where Pinnacle common stockholders will receive one (1) share of Newco common stock for each share they own.
• Synovus common stockholders will receive 0.5237 shares of Newco common stock for each share they own, plus cash in lieu of fractional shares.
• Based on Synovus's closing price on July 21, 2025, the Synovus exchange ratio represented a per-share value of $61.18, a total transaction value of $8.6 billion, and an approximate 10% premium to Synovus's unaffected share value.
• Following the merger, former Pinnacle shareholders are expected to own approximately 51.5% of Newco common stock, and former Synovus shareholders approximately 48.5%.
• Pinnacle Bank will become a Federal Reserve System member bank, and Synovus Bank will merge into Pinnacle Bank, with Pinnacle Bank as the surviving entity.
• The simultaneous mergers are intended to qualify as a reorganization for U.S. federal income tax purposes, meaning shareholders generally will not recognize gain or loss, except for cash received for fractional shares.
• Newco expects to issue approximately 150,255,729 shares of Newco common stock in total.
• Shareholder meetings for approval are scheduled for November 6, 2025, at 9:00 a.m. Eastern Time, to be held virtually.
• Both boards unanimously recommend voting FOR the merger proposals.

Sentiment

Score: 7

Explanation: The merger is presented as a strategically compelling move to create a larger, more competitive regional bank with anticipated synergies and long-term value creation, unanimously recommended by both boards. However, the filing clearly outlines substantial integration costs, regulatory hurdles, and potential risks that could impact the realization of benefits, leading to a balanced positive outlook.

Positives

• The merger creates one of the largest financial services organizations in the Southeast in terms of total consolidated assets, loans, deposits, and revenues.
• The combined company is expected to leverage complementary and diversified revenue streams, leading to superior future earnings and prospects compared to standalone operations.
• There is strong compatibility between Pinnacle's and Synovus's cultures, client-service models, and credit philosophies.
• The combined entity will adopt Pinnacle's high-growth business model, including its geographic structure, hiring philosophy, and compensation system, which has been a key contributor to Pinnacle's historical growth and shareholder returns.
• The transaction provides enhanced scale and reach for the combined company, improving its ability to attract and retain talent and facilitate technology investment.
• Anticipated financial benefits include prospective cost savings and enhanced capital generation.
• Synovus shareholders are expected to benefit from a multiple uplift based on Pinnacle's higher trading multiple associated with its successful high-growth business model.
• The transaction is generally tax-free for U.S. federal income tax purposes for shareholders, except for cash received in lieu of fractional shares.
• A commitment has been made to maintain a significant employee and operational presence in Nashville, TN, and Columbus, GA, for at least five years post-closing, along with significant community engagement.
• The governance structure for the combined company features a carefully balanced board and senior management leadership, designed for clear and continuous leadership from day one.
• Synovus management expresses confidence in obtaining regulatory approval for the transaction.
• Pinnacle has a strong track record of successfully integrating acquisitions and realizing expected financial and other benefits.

Negatives

• Management focus and resources will be diverted from other strategic opportunities and operational matters during the implementation and integration of the two companies.
• There is a possibility of encountering difficulties in achieving the estimated cost savings and synergies, or that they may take longer than anticipated to realize.
• The risk exists that Pinnacle's business model may not be successfully replicated by the combined company.
• Challenges in successfully integrating the businesses, business models, compensation systems, operations, and workforces of Pinnacle and Synovus, including potential employee attrition, are anticipated.
• Significant anticipated merger-related costs are estimated at approximately $720 million pre-tax ($675 million net of one-time LFI costs).
• Regulatory approvals may be delayed, not obtained, or impose unacceptable conditions that could adversely affect Newco or reduce anticipated benefits.
• The potential for legal claims challenging the merger exists.
• The merger will impact the combined company's regulatory capital levels.
• The market price of Newco common stock after the merger may be affected by factors different from those currently affecting Pinnacle or Synovus shares.
• Fairness opinions from financial advisors (Centerview and Morgan Stanley) do not reflect changes in circumstances that may have occurred since their issuance date of July 24, 2025.
• Newco will be subject to additional regulatory requirements as a Category IV bank holding company, a classification not currently applicable to either Pinnacle or Synovus.
• The fixed exchange ratios mean the value of consideration will fluctuate with Pinnacle's stock price, and neither party is permitted to terminate the merger agreement solely due to market price changes.
• Shareholders will have a reduced ownership and voting interest in Newco compared to their individual company holdings prior to the merger.
• Shareholders of Pinnacle and Synovus will not have dissenters' or appraisal rights in the merger.

Risks

• The market price of Newco common stock after the merger may be affected by factors different from those affecting Synovus common stock or Pinnacle common stock currently.
• The fairness opinions delivered by Centerview and Morgan Stanley, respectively, to Pinnacle's and Synovus's respective boards of directors prior to the entry into the merger agreement will not reflect changes in circumstances that may have occurred since the dates of the opinions.
• Combining Pinnacle and Synovus may be more difficult, costly or time consuming than expected and Pinnacle and Synovus may fail to realize the anticipated benefits of the merger.
• Newco may be unable to retain Pinnacle and/or Synovus personnel successfully after the merger is completed.
• Regulatory approvals may not be received, may take longer than expected or may impose conditions that are not presently anticipated or that could have an adverse effect on Newco following the merger.
• The unaudited pro forma condensed combined financial information included in this joint proxy statement/prospectus is preliminary and the actual financial condition and results of operations of Newco after the merger may differ materially.
• Certain of Pinnacle's and Synovus's directors and executive officers may have interests in the merger that may differ from the interests of holders of Pinnacle common stock and of holders of Synovus common stock.
• The merger agreement may be terminated in accordance with its terms and the merger and other transactions contemplated by the merger agreement may not be completed.
• Failure to complete the merger could negatively impact Pinnacle or Synovus, including potential litigation and the payment of a $425 million termination fee under certain circumstances.
• Pinnacle and Synovus will be subject to business uncertainties and contractual restrictions while the merger is pending, potentially impairing their ability to attract/retain key personnel or pursue attractive business opportunities.
• The merger agreement contains provisions that could discourage a potential competing acquirer that might be willing to pay more to acquire or merge with either Pinnacle or Synovus, including a $425 million termination fee.
• The shares of Newco common stock to be received by holders of Pinnacle common stock and Synovus common stock as a result of the merger will have different rights from the shares of Pinnacle common stock and Synovus common stock.
• Pinnacle and Synovus will incur significant transaction and integration costs in connection with the merger, estimated at approximately $720 million pre-tax.
• In connection with the merger, Newco will assume Pinnacle's and Synovus's outstanding debt obligations and preferred stock, and Newco's level of indebtedness following the completion of the merger could adversely affect Newco's ability to raise additional capital and to meet its obligations.
• Following completion of the merger, holders of Newco common stock will be subject to the prior dividend and liquidation rights of the holders of the Newco preferred stock and Newco depositary shares.
• Pinnacle shareholders and Synovus shareholders will have a reduced ownership and voting interest in Newco after the merger and will exercise less influence over management.
• Pinnacle shareholders and Synovus shareholders will not have dissenters' rights or appraisal rights in the merger.
• Shareholder litigation could prevent or delay the completion of the merger or otherwise negatively impact the business and operations of Pinnacle and Synovus.
• Deterioration in the financial condition of borrowers of the combined bank and its respective subsidiaries, including as a result of persistent elevated interest rates, the negative impact of inflationary pressures and challenging economic conditions on customers and their businesses, resulting in significant increases in loan losses and provisions for those losses.
• Fluctuations or differences in interest rates on loans or deposits from those that Pinnacle or Synovus is modeling or anticipating, including as a result of Pinnacle Bank's or Synovus Bank's inability to better match deposit rates with the changes in the short-term rate environment, or that affect the yield curve.
• The impact of U.S. and global economic conditions and geopolitical instability.
• The sale of investment securities in a loss position before their value recovers, including as a result of asset liability management strategies or in response to liquidity needs.
• Adverse conditions in the national or local economies including in Pinnacle's and Synovus's markets, particularly in commercial and residential real estate markets.
• The inability of each of Newco, Pinnacle or Synovus, or the entities in which they have significant investments to maintain the long-term historical growth rate of its, or such entities, loan portfolio.
• The ability to grow and retain low-cost core deposits and retain large, uninsured deposits, including during times when the combined bank is seeking to limit the rates it pays on deposits or uncertainty exists in the financial services sector.
• Changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments.
• Effectiveness of Newco's asset management activities in improving, resolving or liquidating lower-quality assets.
• The impact of competition with other financial institutions, including pricing pressures and the resulting impact on Newco's results, including as a result of the negative impact to net interest margin from elevated deposit and other funding costs.
• The results of regulatory examinations of Newco or the combined bank, or companies with whom they do business.
• Risks of expansion into new geographic or product markets.
• The risk that the cost savings and synergies from the proposed merger may not be fully realized or may take longer than anticipated to be realized.
• Disruption to Synovus's business and to Pinnacle's business as a result of the announcement and pendency of the proposed merger.
• The risk that the integration of Pinnacle's and Synovus's respective businesses and operations will be materially delayed or will be more costly or difficult than expected, including as a result of unexpected factors or events.
• The failure to obtain the necessary approvals of the proposed merger by the shareholders of Synovus or Pinnacle.
• The amount of the costs, fees, expenses and charges related to the proposed merger.
• The ability of each of Synovus and Pinnacle to obtain required governmental approvals of the proposed merger on the timeline expected, or at all, and the risk that such approvals may result in the imposition of conditions that could adversely affect Newco after the closing of the proposed transaction or adversely affect the expected benefits of the proposed transaction.
• Reputational risk and the reaction of Pinnacle's and Synovus's customers, suppliers, employees or other business partners to the proposed merger.
• The failure of the closing conditions in the merger agreement related to the proposed merger to be satisfied, or any unexpected delay in closing the proposed merger or the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement.
• The dilution caused by the issuance of shares of Newco common stock resulting from the proposed merger.
• The possibility that the proposed merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events.
• Risks related to management and oversight of the expanded business and operations of Newco following the closing of the proposed merger.
• The possibility that Newco is subject to additional regulatory requirements as a result of the proposed merger or expansion of Newco's business operations following the proposed merger, including as a result of Newco's status as a large financial institution for regulatory purposes.
• The outcome of any legal or regulatory proceedings or governmental inquiries or investigations that may be currently pending or later instituted against Synovus, Pinnacle or Newco resulting from the proposed merger.
• General competitive, economic, political and market conditions and other factors that may affect future results of Newco including changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer borrowing, repayment, investment and deposit practices; the impact, extent and timing of technological changes, including artificial intelligence; and capital management activities.
• Any matter that would cause Pinnacle or Synovus to conclude that there was impairment of any asset, including goodwill or other intangible assets.
• The ineffectiveness of Pinnacle Bank's or Synovus Bank's hedging strategies, or the unexpected counterparty failure or hedge failure of the underlying hedges.
• Reduced ability to attract additional experienced financial services professionals (or failure of such professionals to cause their clients to switch to the combined bank after the proposed merger), to retain experienced financial services professionals (including as a result of the competitive environment for associates) or otherwise to attract customers from other financial institutions.
• Deterioration in the valuation of other real estate owned and increased expenses associated therewith.
• Inability to comply with regulatory capital requirements, including those resulting from changes to capital calculation methodologies, required capital maintenance levels or regulatory requests or directives, particularly if the combined bank's level of applicable commercial real estate loans were to exceed percentage levels of total capital in guidelines recommended by its regulators.
• Approval of the declaration of any dividend by Pinnacle's or Synovus's board of directors.
• The vulnerability of the combined bank's network and online banking portals, and the systems of parties with whom the combined bank contracts, to unauthorized access, computer viruses, phishing schemes, spam or ransomware attacks, human error, natural disasters, power loss and other security breaches.
• The possibility of increased compliance and operational costs as a result of increased regulatory oversight, including oversight of companies in which Pinnacle, Pinnacle Bank, Synovus or Synovus Bank have significant investments, and the development of additional banking products for the combined bank's corporate and consumer clients.
• Newco's ability to identify potential candidates for, consummate, and achieve synergies from, potential future acquisitions.
• Difficulties and delays in integrating acquired businesses or fully realizing costs savings and other benefits from acquisitions.
• The risks associated with Pinnacle Bank being a minority investor in Bankers Healthcare Group, LLC (BHG), including the risk that the owners of a majority of the equity interests in BHG decide to sell the company or all or a portion of their ownership interests in BHG (triggering a similar sale by Pinnacle Bank).
• Changes in or interpretations of state and federal legislation, regulations or policies applicable to banks and other financial service providers, like BHG, including regulatory or legislative developments such as the enactment of legislation providing a federal framework for the issuance of stablecoins (the GENIUS Act) and the potential impact on the level of Newco deposits and payment services.
• Fluctuations in the valuations of Pinnacle's or Synovus's equity investments and the ultimate success of such investments.
• The availability of and access to capital.
• Adverse results (including costs, fines, reputational harm, inability to obtain necessary approvals and/or other negative effects) from current or future litigation, regulatory examinations or other legal and/or regulatory actions involving Pinnacle, Pinnacle Bank, Synovus, Synovus Bank or BHG.

Future Outlook

The merger is expected to close in the first quarter of 2026, subject to shareholder and regulatory approvals. The combined company anticipates realizing approximately $282 million in gross pre-tax cost savings, phased in 50% during 2026, 75% in 2027, and 100% thereafter. The transaction is projected to be accretive to Pinnacle's 2026E and 2027E earnings per share, but dilutive to its tangible book value per share and common equity Tier 1 ratio. Newco will also be subject to additional regulatory requirements as a Category IV bank holding company.

Management Comments

• M. Terry Turner, President and Chief Executive Officer of Pinnacle Financial Partners, Inc., and Kevin Blair, Chairman, Chief Executive Officer and President of Synovus Financial Corp., jointly stated strong support for this combination of our companies and join our boards in their recommendations.
• M. Terry Turner believes Pinnacle's business model, including its geographic structure, hiring philosophy, and compensation system, has been a key contributor to Pinnacle's growth and shareholder returns.
• Kevin Blair highlighted factors distinguishing this merger from other recent 'merger of equals' transactions, including clear and continuous leadership from day one, the need to make difficult decisions early in the process regarding operating model and talent, cultural fit between the institutions, and taking the best of both institutions.
• Kevin Blair confirmed to the Pinnacle board his intention to maintain the Pinnacle business model for the combined company.

Industry Context

The banking industry is experiencing increasing competitive pressures from larger national and super-regional banks, as well as non-bank financial and financial technology firms. The advantages of scale have become more significant in terms of new technologies, delivery channels, and product offerings. Recent large mergers in the Southeast region indicate a trend towards consolidation. The largest U.S. banks have demonstrated significantly higher organic growth rates compared to regional banks like Pinnacle and Synovus. Bank failures in March 2023 further exacerbated this trend by driving deposit inflows to larger institutions perceived as 'too big to fail.' There is a perception of increasing regulatory openness to large-scale bank consolidation, with potential easing of requirements for banks crossing the $100 billion asset threshold, although a significant portion of large financial institutions still face examination rating challenges for acquisitions.

Comparison to Industry Standards

• Pinnacle Bank is recognized as the No. 1 bank in the Nashville-Murfreesboro-Franklin MSA, according to June 30, 2024 deposit data from the Federal Deposit Insurance Corporation (FDIC).
• Pinnacle is ranked No. 11 on FORTUNE magazine's 2024 list of 100 Best Companies to Work For in the U.S., marking its eighth consecutive appearance.
• Pinnacle is also recognized as the No. 3 company to work for in the U.S. for financial services and insurance, No. 8 for women, No. 9 for millennials, and No. 21 for parents, all in 2024.
• Pinnacle is ranked No. 5 on American Banker's 2024 list of America's Best Banks to Work For and No. 1 among banks with more than $10 billion, its 12th consecutive appearance.
• The combined company is expected to become one of the largest financial services organizations in the Southeast in terms of total consolidated assets, loans, deposits, and revenues.
• The boards believe this transaction is differentiated from other recent large 'merger of equals' transactions due to its clear and continuous leadership from day one, early decision-making on operating model and talent, strong cultural fit, and commitment to adopting the best practices from both institutions.

Management Changes

Corporate Governance

Legal Proceedings

• No pending or threatened lawsuits relating to the transactions contemplated by the merger agreement are known as of the date of the joint proxy statement/prospectus.
• Demand letters have been received from purported shareholders of Synovus and Pinnacle alleging deficiencies and/or omissions of allegedly material information in the Form S-4 registration statement.
• Synovus and Pinnacle believe that the allegations in these demand letters are without merit.
• There can be no assurances that additional complaints or demands will not be filed or made with respect to the merger in the future.

Related Party Transactions

• No transactions of the type required to be reported under Item 404 of Regulation S-K are disclosed, other than those already set forth in Synovus or Pinnacle Reports.
• No outstanding loans from Synovus or Pinnacle to executive officers or other insiders, other than those compliant with or exempt from Regulation O.
• M. Terry Turner (Pinnacle President and CEO) entered into a letter agreement for post-merger roles, including a $22,800,000 non-compete payment and an $8,500,000 success and continuity award.
• Robert A. McCabe, Jr. (Pinnacle Chairman) entered into a letter agreement for post-merger roles, including an $8,100,000 non-compete payment and a cash compensation opportunity of $5,890,000 during the first year.
• Kevin S. Blair (Synovus CEO) entered into an executive employment agreement for post-merger roles, including an annual base salary of no less than $1,150,000 and annual long-term incentive awards with a target grant date fair value of not less than $5,800,000.
• Andrew J. Gregory, Jr. (Synovus CFO) entered into an executive employment agreement for post-merger roles, including an annual base salary of no less than $675,000 and annual long-term incentive awards with a target grant date fair value of not less than $1,825,000.
• Certain Synovus executive officers (Kevin J. Howard, D. Wayne Akins, Zack Bishop) have change of control agreements providing for severance payments and benefits upon a qualifying termination, with Mr. Howard's agreement including a gross-up payment for excise taxes under Section 4999 of the Code.

Stakeholder Impact

• **Shareholders**: Pinnacle shareholders will receive one Newco share for each Pinnacle share, and Synovus shareholders will receive 0.5237 Newco shares for each Synovus share, generally tax-free for U.S. federal income tax purposes (except for fractional shares). They will have a reduced ownership and voting interest in Newco and will not have dissenters' or appraisal rights. They will participate in the future growth and synergies of the combined entity but will be subject to the prior dividend and liquidation rights of Newco preferred stock.
• **Employees**: Continuing employees will receive no less favorable base salary, annual bonus, long-term incentive opportunities, and aggregate employee benefits for one year post-merger. Severance benefits are provided for certain terminated employees. There is a risk of employee attrition during the integration process.
• **Customers**: The merger aims to create a larger, more competitive bank, potentially leading to enhanced products and services. However, there is a risk of disruption to ongoing business relationships during the integration period.
• **Suppliers**: Existing business relationships with suppliers may be subject to change as the combined company integrates operations and seeks efficiencies.
• **Creditors**: Newco will assume the outstanding debt obligations of both Pinnacle and Synovus. The combined entity's overall indebtedness could influence its future ability to raise capital and meet existing obligations.
• **Communities**: Newco has committed to maintaining a significant employee and operational presence in Nashville, Tennessee, and Columbus, Georgia, for a minimum of five years, along with maintaining significant community engagement in these metro areas at not less than current levels.

Next Steps

• Pinnacle and Synovus shareholders will vote on the merger agreement and related proposals at virtual special meetings on November 6, 2025.
• Obtain necessary regulatory approvals from the Federal Reserve Board, Tennessee Department of Financial Institutions (TDFI), Georgia Department of Banking and Finance (GDBF), and FINRA.
• Newco will cause the S-4 registration statement to be declared effective by the SEC.
• Newco common stock and preferred stock (or depositary shares) will be approved for listing on the NYSE.
• Pinnacle Bank will become a member bank of the Federal Reserve System (FRS Membership).
• Synovus Bank will merge with and into Pinnacle Bank (Bank Merger).
• Finalize the valuation analysis and calculations for purchase price allocation.
• Integrate the businesses, operations, and workforces of Pinnacle and Synovus.
• Newco will comply with additional regulatory requirements as a Category IV bank holding company.
• Pinnacle and Synovus will coordinate dividend declarations until merger completion.
• Address any shareholder litigation that may arise.

Key Dates

Recommendation

The proposed all-stock merger between Pinnacle and Synovus creates a larger regional bank with significant strategic rationale, including enhanced scale, diversified revenue streams, and anticipated cost synergies. The unanimous board recommendations and positive financial advisor opinions support the strategic merits. However, the transaction involves substantial integration risks, significant one-time costs, and regulatory uncertainties, including the transition to Category IV LFI status. While the deal is expected to be accretive to EPS, it will be dilutive to tangible book value and CET1 ratio, indicating a mixed financial impact in the short term. The fixed exchange ratio also exposes shareholders to fluctuations in Pinnacle's stock price. Given the balanced risk-reward profile, with clear strategic benefits offset by considerable execution risks and costs, a 'hold' recommendation is appropriate for existing shareholders to await further clarity on integration success and regulatory outcomes. New investors should consider the inherent volatility and long-term integration challenges.

Keywords

Merger, Banking, Financial Services, Pinnacle Financial Partners, Synovus Financial Corp, Newco, SEC Filing, Proxy Statement, Shareholder Vote, Bank Merger, Regulatory Approval, Corporate Governance, Risk Management, Strategic Business Analysis, Southeast Banking, All-stock Transaction, Integration Costs, Synergies