First Financial, the parent company of First Financial Bank, has agreed to acquire Kentucky-based bank holding company HopFed Bancorp (HFBC), in a cash and stock deal worth around $128.3m.
Image: HFBC to be acquired by First Financial. Photo: courtesy of rawpixel/Unsplash.com.
Following the completion of the transaction, Heritage Bank USA, a subsidiary of HFBC, will merge with First Financial Bank.
Headquartered in Hopkinsville, HFBC holds nearly $905m in consolidated assets. Through Heritage Bank, it has 18 bank branches and three loan production offices in Kentucky and Tennessee.
Heritage Bank operates as a community banking organization and provides a range of banking and financial products and services.
The Indiana-based First Financial, on the other hand, has assets of about $3bn. Through First Financial Bank, it operates 65 banking centers across east-central Illinois and west-central Indiana.
It offers a range of financial services such as commercial, mortgage and consumer lending, lease financing, depositor services and trust account services through its subsidiaries, First Financial Bank and The Morris Plan Company of Terre Haute.
First Financial president and CEO Norman Lowery said: “This acquisition is exciting for our company. Heritage provides us with an opportunity to leverage our capabilities and expand into new markets.
“We look forward to continuing Heritage’s commitment to its customers and the communities it serves.”
As per the merger terms, which has been approved unanimously by the two companies’ boards, HFBC shareholders have the option to choose either or a combination of 0.444 shares issuance of First Financial common stock or $21.00 in cash for each share they hold in HFBC.
Upon completion of the merger, First Financial, which will be the surviving company, will have total consolidated assets of about $3.9bn.
HFBC president and CEO John Peck said: “The agreement with First Financial provides us with stability and growth opportunities that will allow our customers to continue to enjoy a great relationship with a strong community-focused financial organization.”
The deal, which will be subject to customary closing conditions, such as regulatory and HFBC stockholder approvals, is anticipated to be completed in the second quarter of 2019.