Hedge fund Driver Management pushes for sale at Codorus Valley Bancorp

Codorus Valley Bancorp

06/07/2021 21:00

By Svea Herbst-Bayliss
    BOSTON, July 6 (Reuters) - Activist investment firm Driver
Management, which specializes in pushing small banks to improve
their financial returns, has found a new target and is now
urging Codorus Valley Bankcorp Inc  CVLY.O  to consider letting
itself be bought, two sources familiar with the matter said on
Tuesday.
    Driver Management, founded two years ago by former
investment banker Abbott Cooper, owns a 6% stake in Codorus, a
bank holding company, and is expected to make a regulatory
filing disclosing its stake and some of its intentions soon, the
sources said.
    Codorus, which is headquartered in York, Pennsylvania, is
valued at $202 million and specializes in providing banking
services through its subsidiary PeoplesBank in south central
Pennsylvania and northern Maryland. Its share price has climbed
21% this year and traded at $20.20 on Tuesday. 
    The company did not respond to a request for comment.
    Driver's new investment comes as analysts are forecasting a
pickup in mergers and acquisitions in the still-fragmented small
bank sector. Driver has successfully pushed for other banks to
be bought over the past two years.
    Cooper wants Codorus to immediately hire a financial adviser
to review all options including a sale, a source familiar with
the fund manager's thinking said.
    He has expressed concerns to the bank about long-term
underperformance and a lack of scale, and has offered to enter a
standstill agreement if the bank seriously considers a sale, the
source said.
    For Driver, the new investment comes on the heels of a win. 
   Last month United Bankshares said that it would buy Community
Bankers Trust Corporation, which Driver had last year pushed to
sell itself. Driver Management has gained roughly 48% since
January, a person familiar with its return said.

 (Reporting by Svea Herbst-Bayliss; Editing by Kevin Liffey)
 ((svea.herbst@thomsonreuters.com; +617 856 4331; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))