DENVER — There's been no deal yet, but a dozen credit union groups, half from Colorado, may be bidding on the deeply troubled New Horizons Community Credit Union with a decision on a purchaser "weeks away," according to the state's top regulator.
The $180 million New Horizons, a victim of faulty construction loans and Centrix Financial subprime credits, was put into NCUA conservatorship in April 2006, but last month the state's commissioner of financial services, Chris Myklebust said problems had worsened calling the CU "critically undercapitalized" and in need of a purchase-assumption.
Representatives from a dozen CU groups took part in an informational "bidders' meeting" Feb. 8 conducted by the Colorado Division of Finance and NCUA at an airport hotel, said Myklebust.
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"We're now in the due diligence process," said Myklebust, noting bidders' packets have been distributed with some of the prospective buyers expected to make on-site inspections of the New Horizons offices and branches.
Myklebust declined to name any of the interested buyers, but several large Colorado CUs had earlier said they planned to attend the Feb. 8 bidders' meeting at the Embassy Suites Airport Hotel.
His office and Melinda Love, NCUA's Region Five director based in Tempe, Ariz., will make a final decision on a new Horizons buyer.
Of the prospective buyers group, both the $1.9 billion Ent Federal Credit Union of Colorado Springs and the $700 million Westerra Credit Union of Denver earlier had confirmed their plans to attend the Feb. 8 meeting.
Both of those two CUs have been active Colorado acquirers in recent years with Ent picking up the $90 million Decibel Community Credit Union of Pueblo, Colo. in December.
A spokesman for Ent acknowledged Decibel did have Centrix loans in its portfolio, but maintained the merger was put forward because of the close management and employer ties Decibel had with a formerly merged CU now part of Ent. That CU was Mountain Bell Credit Union of Colorado Springs, which was merged into Ent in July 2001.
Decibel, one of the first CUs chartered in Colorado, was founded in 1938 to serve Pueblo-area employees of Bell Telephone. Myklebust said it was uncertain how a New Horizons merger might occur suggesting there could be "multiple scenarios" in which one bidder takes a portion of New Horizons assets or a group takes several parts. –[email protected]
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