No downside to nixing Comerica deal, says activist investor

• Key insight: Activist investor HoldCo Asset Management, which holds a roughly $200 million stake in Comerica, will vote against the bank’s blockbuster sale to Fifth Third. It argues the Dallas bank could likely strike another deal with better terms.
• What’s at stake: The deal would mark one of the largest bank acquisitions in recent history.
• Forward look: The Jan. 6 shareholder votes are sandwiched between two court hearings in HoldCo’s legal battle against Comerica and Fifth Third. The investment firm will also be able to gather depositions from the banks.

Update: This story includes information HoldCo released Monday about the size of its stake in Comerica. An earlier version included older data that was drawn from public filings. The current version also notes that Comerica and Fifth Third did not respond to a request for comment.

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The activist investor that pressured Comerica to sell itself over the summer will vote against the bank’s proposed sale to Fifth Third Bancorp , arguing that the seller could likely strike a better offer.

HoldCo Asset Management, which has made waves in the banking industry by launching activist campaigns against Comerica and four other banks this year, says in a presentation seen by American Banker that there’s “significant upside and limited downside” in voting against the transaction.

HoldCo is against the deal, in part, because of what it calls an “unacceptable” negotiation process — an issue that is also the subject of a lawsuit the firm brought against Comerica and Fifth Third in a Delaware court.

HoldCo also believes there’s room for Fifth Third to sweeten its offer, or for another bank to put forward a strong, competing bid, according to the presentation, which was released publicly later Monday morning.

Last week, Fifth Third CEO Tim Spence said at an industry conference that he’s “not worried at all” about HoldCo’s lawsuit, or about getting the deal past the finish line. He added that he thinks the shareholder votes will go smoothly for both companies.

HoldCo owns roughly $182 million of Comerica stock based on market value, or about 1.6% of the outstanding shares, according to the firm. In July, the group pressured Comerica to sell itself due to what it characterized as years of mismanagement.

The nearly $11 billion transaction is the largest bank deal announced in 2025, and the 17-day negotiation timeline was the fastest to come together among major acquisitions, according to an American Banker analysis of public filings.

Late this summer, Comerica was approached by “Financial Institution A” to possibly put a purchase together, but the Dallas bank instead sought out Fifth Third, according to a securities filing by Comerica and Fifth Third. Financial terms of that deal weren’t disclosed.

The unnamed bank was Regions Financial, anonymous sources later told American Banker.

“If so, Regions — which has not done a deal in 2025, is one of the most respected superregionals, and has a deposit base and growth markets arguably superior to Fifth Third — likely remains interested and appears capable of submitting a materially higher bid,” HoldCo said in its latest presentation.

Spence said last week that “job number-one” on these types of deals is to do no harm. But he added that the deal will transform Fifth Third through a number of benefits, including $500 million in revenue opportunities over the next three to five years, a beachhead in Texas, and a life sciences and tech loan portfolio.

“What we’re excited about with Comerica is the expense synergies paid for the deal, but the markets, the vertical expertise … and middle-market franchise and the culture they have there are really the foundation for like a decade of organic growth opportunities at Fifth Third,” Spence said at the conference.

Comerica has for years been strapped for access to low-cost funding — a problem that will be diminished if the company is absorbed into the larger Fifth Third.

Fifth Third and Comerica did not provide a response to a request for comment.

HoldCo has said it believes it likely that there were additional, undisclosed talks between Comerica and Fifth Third.

The sale agreement currently comes with no dilution to tangible book value, which is uncommon in bank M&A deals, but attractive for buyers that don’t want their shares to lose value. The deal also keeps Comerica CEO Curt Farmer on as an executive, and eventual board member, at Fifth Third, with the chance of earning nearly $100 million over the next decade.

Comerica and Fifth Third are both scheduled to hold their shareholder votes on Jan. 6. But even if the banks don’t get the requisite shareholder approvals, they don’t necessarily have to call the deal off. A “no” vote would trigger another round of negotiations and a submission of new deal terms.

The latest legal developments

Even with a “yes” from shareholders, HoldCo may be able to get more answers to its questions about the banks’ dealmaking process.

A Delaware judge will hold a hearing on Jan. 2, four days before the shareholder votes, during which HoldCo will have the chance to argue that Comerica didn’t provide adequate disclosures about how the deal was hatched. The bank is required to submit relevant board materials, like meetings or presentations, and answers to interrogatories filed by HoldCo’s lawyers this month, according to HoldCo’s presentation.

After the first hearing, HoldCo’s counsel can serve requests to the two banks for additional discovery, which can include privilege logs and correspondence, along with depositions.

Then a second hearing, slated for Feb. 23, will focus on the question of whether the deal should be shut down before it closes.

However, the two banks may be seeking to complete the transaction even before that hearing.

If everything goes to plan for the banks, the earliest the deal could close is Feb. 2, per the merger agreement. American Banker previously reported, citing a source familiar with the matter, that Comerica is aiming to close on that date.

Many analysts have said the deal is a good one for both Comerica and Fifth Third. In a research note last month, TD Securities analysts expressly disagreed with HoldCo’s assertion that Comerica could have found a better offer.

HoldCo isn’t the only party that opposes the deal.

An anonymous group calling itself the Comerica 175 Coalition has filed multiple comment letters with the Federal Reserve Bank of Cleveland, asking the agency to hold a public hearing on the deal and compel the banks to delay their shareholder votes.

Like HoldCo, the group has raised questions about the dealmaking process between the two banks.