Bank of Vienna said yesterday that it has received a tentative, $40-a-share merger proposal from a bank it would not name.
Sources close to the bank said, however, that Central Fidelity Banks Inc., a Richmond-based bank holding company, has made the merger proposal to the $25-million-asset suburban institution.
Two other major Virginia bank companies -- Bank of Virginia and Dominion Bankshares Corp. -- are bidding to acquire Bank of Vienna. Bank of Virginia, which already has contracts to buy 21 percent of the Vienna Bank's stock, has made a straight cash offer of $31 a share.
The board of the Vienna bank, however, reached a merger agreement with Dominion for an offer worth $35 a share, although the merger needs the approval of two-thirds of the smaller bank's shareholders. Bank regulators have yet to approve either Bank of Virginia's hostile taekover bid or Dominion's friendly merger proposal.
Sources close to the Bank of Virginia expect the institution to boost its $31-a-share offer if it receives Federal Reserve approval.
A spokesman for the Vienna bank said he would not name the party that made the $40-a-share offer because it is tentative and has many conditions attached to it. But a source close to the bank said Central Fidelity has been talking to the Vienna bank for about three weeks, although it has made no formal proposal to the bank's board