By Svea Herbst-Bayliss and Arasu Kannagi Basil
Jan 6 (Reuters) - Comerica shareholders on Tuesday approved a $10.9 billion sale to larger rival Fifth Third Bancorp, the two companies said, ignoring an activist
hedge fund's calls to block the deal after having initially urged the bank to put itself up for sale.
At the special meeting, a preliminary tally showed 97% of Comerica shareholders voted in favor of the deal while 2.2% voted against it, according to a source familiar with the matter.
The merger, which the companies said is expected to close in the first quarter of 2026, will create the ninth-largest U.S. bank, with combined assets of $290 billion. It was also the biggest bank deal of 2025.
The chief executives of both companies praised the shareholder vote and said the combination will benefit customers and investors.
Reuters first reported news of the shareholder vote earlier on Tuesday.
Fifth Third shareholders also voted on Tuesday, with a majority approving a proposal to issue stock in connection with the merger, executives said at the special meeting.
Activist investor HoldCo Asset Management, which originally pushed Comerica to put itself up for sale last year, ended up opposing the sale to Fifth Third. HoldCo said the bank rushed the sale to avoid a potential proxy fight and protect the CEO from an ouster, rather than to maximize value for shareholders.
Investors, however, turned a deaf ear to HoldCo, voting overwhelmingly to accept the all-stock deal first announced in October. HoldCo did not return calls seeking comment.
Last year, HoldCo made headlines by pressing a handful of regional banks for strategic changes and laying a path to what analysts have said may be fresh dealmaking in the banking sector where the pace has been slower than in other areas.
Proxy advisory firm Institutional Shareholder Services, whose recommendations often guide big investors' votes on mergers or other hot-button issues like who will serve on the board, last month credited HoldCo for its role in the planned Comerica/Fifth Third merger. It wrote that HoldCo's planned campaign likely served as a catalyst in Comerica's decision to consider a transaction.
It recommended that shareholders vote for the deal, citing the double-digit premium and Fifth Third's position as a stronger bank.
With shareholders ratifying the transaction, the next step would be the remaining regulatory approvals for the deal to be completed. The deal last month secured regulatory approval from the Office of the Comptroller of the Currency.
HoldCo is waging its battle against the deal in Delaware court, having sued both banks.
The transaction, one of the biggest U.S. regional bank deals in the past decade, adds to Fifth Third's large presence in the U.S. Midwest and expands its growth prospects in Texas, Arizona, and California.
(Reporting by Arasu Kannagi Basil in Bengaluru and Svea Herbst-Bayliss in New York, Editing by Dawn Kopecki and Matthew Lewis)
