St. Paul-based Otto Bremer Trust, the majority shareholder of Bremer Financial Corporation, has announced that it will begin exploring strategic options for BFC, including a sale or merger, to strengthen the bank and its own philanthropic work.
According to OBT co-CEO and trustee Brian Lipschultz, the board of BFC could not agree on "a collaborative path forward" in the face of challenges in the banking industry. To resolve the impasse, the trust has sold approximately 7 percent of BFC's common stock to a number of investors in separate transactions. The trust also has called for a special meeting of BFC shareholders to seat a new board and explore the bank's strategic options. "Because of the changes in the financial services industry, it can be daunting for a standalone regional bank to succeed," said Lipschultz. "Through this initiative, BFC can be part of a stronger banking organization that better serves its customers and successfully competes for new ones."
The trust, which, after the recent stock sales, controls 86 percent of BFC, has awarded more than $700 million in grants and program-related investments since its founding in 1944. In September, it announced plans to expand its activities to all of Wisconsin and Montana by the middle of 2020.
"This is not a decision we made lightly or without exploring every other approach," said Otto Bremer Trust co-CEO and trustee Daniel Reardon, "but we believe it is necessary to fulfill our legal obligations and is in the best interests of the individuals and communities that OBT serves. A successful transaction would enable an incredibly significant increase in OBT's philanthropy and allow us to expand our work in Minnesota, North Dakota, Wisconsin, and Montana. We also believe a strategic combination with a larger financial institution will strengthen BFC's ability to serve its customers and will provide good jobs and careers."