공고 • Feb 15
First Mid Bancshares, Inc. (NasdaqGM:FMBH) completed the acquisition of Delta Bancshares Company.
First Mid Bancshares, Inc. (NasdaqGM:FMBH) executed the letter of intent to acquire Delta Bancshares Company for approximately $110 million on March 19, 2021. First Mid Bancshares, Inc. entered into an agreement to acquire Delta Bancshares Company on July 28, 2021. Under the terms of the agreement, Delta Bancshares Company's shareholders and option holders will receive an aggregate of approximately $15.2 million in cash and 2,282,511 shares of First Mid Bancshares, Inc. Delta’s outstanding stock options will be fully vested upon consummation of the merger and all outstanding Delta options that are unexercised prior to the closing will be cashed out. In a related transaction, First Mid ended acquisition of a St. Louis based commercial lending team including a portfolio of loans of approximately $225 million and deposits of approximately $280 million. Following completion, the separate corporate existence of Delta will cease. It is anticipated that Delta’s wholly owned bank subsidiary, Jefferson Bank and Trust Company will be merged with and into First Mid Bank at a date following completion of the merger. Under the terms of the agreement, Delta Bancshares is obligated to pay First Mid a termination fee of $3.1 million under circumstances listed in the agreement. Delta Bancshares reported a net income of $5 million in 2020. As of June 30, 2021, Delta Bancshares had total assets of $697 million.
The transaction is subject to regulatory approvals and the satisfaction of customary closing conditions. The transaction has been unanimously approved by both Delta’s and First Mid’s board of Directors. A special meeting of stockholders of Delta Bancshares Company, will be held on October 28, 2021 to approve the transaction. On October 28, 2021, at a special meeting of the stockholders of Delta, Delta’s stockholders voted to approve the merger. On January 26, 2022, First Mid Bancshares received Federal Reserve approval for the acquisition. The transaction is expected to close in the fourth quarter of 2021. As of October 28, 2021, subject to the satisfaction of customary closing conditions in the agreement and receipt of all regulatory approvals, the merger is anticipated to be completed in late 2021. As on January 28, 2022, closing of the acquisition is expected to occur on February 11, 2022. As of February 8, 2022, the expected closing of the transaction is on February 14, 2022. Due to the fact the Missouri Secretary of State is closed on February 11, 2022. On a combined basis, the two transactions are estimated to be approximately 14% accretive to earnings per share in 2022 (excluding nonrecurring transaction expenses). Estimated tangible book value per share dilution to First Mid is expected to be earned back in 1.8 years under the crossover method. First Mid Bancshares expects to achieve cost savings of 30% of the combined noninterest expense. While revenue synergies are anticipated, they have not been included in the estimates. Upon closing of the transactions, First Mid Bancshares expects to remain above well-capitalized standards on all regulatory capital ratios with a Tier 1 Leverage Ratio of approximately 8.8%, a Total Risk-Based Capital Ratio of approximately 13.0% and a Tangible Common Equity Ratio of approximately 8.4%.
Stephens Inc. acted as financial advisor and Lauralyn G. Bengel, Olga Bogush and Jason L. Zgliniec of Schiff Hardin LLP acted as legal advisors to First Mid Bancshares. Piper Sandler & Co. acted as financial advisor and fairness opinion provider to Delta Bancshares Company. Piper Sandler will receive an advisory fee for such services in an amount equal to $500,000, which fee is contingent upon the closing of the merger. Piper Sandler also received a $150,000 fee from Delta upon rendering its opinion, which opinion fee will be credited in full towards the advisory fee which will become payable to Piper Sandler upon closing of the transaction. Paul J. Cambridge of Armstrong Teasdale LLP acted as legal advisor to Delta Bancshares Company.
First Mid Bancshares, Inc. (NasdaqGM:FMBH) completed the acquisition of Delta Bancshares Company on February 14, 2022. On an aggregate basis, the total consideration payable by First Mid at the closing of the Merger to Delta’s shareholders and option holders was approximately $15.2 million in cash and 2,292,270 shares of First Mid common stock. As of December 31, 2021, Delta had approximately $718 million in total assets.