Horizon Bancorp and CNB Bancorp have announced they have executed a definitive merger agreement (pursuant to which Horizon will acquire CNB Bancorp, parent company of The Central National Bank and Trust Company.
Under the terms of the Merger Agreement, stockholders of CNB Bancorp will receive cash consideration consisting of a special dividend (calculated as capital in excess of 8% of CNB Bancorp’s total assets, less certain after tax transaction costs, all as described in the Merger Agreement) and an amount to be paid by Horizon equal to 120% of remaining capital.
These amounts will be determined as of the end of the month prior to the closing of the merger. These amounts are dependent on CNB Bancorp’s earnings and other factors, but if the cash consideration for the stockholders were calculated as of 31 March, 2016, the stockholders would receive, in the aggregate, a $6.7m special dividend and a $5.3m payment from Horizon.
CNB Bancorp is headquartered in Attica, Indiana, and through its wholly-owned subsidiary Central National Bank & Trust, which was established in 1887, serves the greater Attica area with one full-service banking location and one drive-up location. As of March 31, 2016, CNB Bancorp had total assets of approximately $55.3m.
Horizon Bancorp is a community bank holding company headquartered in Michigan City, Indiana with total assets of $2.6bn as of 31 March 2016. Horizon Bancorp’s wholly-owned subsidiary, Horizon Bank, still operates under its original charter, dating back to 1873, with fifty offices extending throughout northern and central Indiana and southwestern and central Michigan.
Horizon’s Chairman and Chief Executive Officer, Craig M. Dwight said: “We are enthusiastic about this merger, as it is consistent with Horizon’s philosophy of partnering with banks that hold core values similar to ours and a commitment to serving their local communities.
“Horizon will add value to Central National Bank & Trust’s customer base through our extensive product and service offerings and on-line banking services.”
Dwight further explained, “This merger provides an excellent complement for Horizon to fill in the gap between our branch locations in northern and central Indiana. We believe increasing our presence in this region will provide Horizon with growth opportunities and the ability to attract and retain seasoned bankers, which are key components to our future success.”
Central National Bank & Trust chief executive officer William McAdams stated: “We are pleased with the opportunity to partner with the Horizon Bank family and the increased opportunities this provides our customers, employees and the community we serve.
“Horizon’s demonstrated commitment to preserve true community banking, which means local decision-making, retention of local staff, commitment to community involvement, and personal one-on-one service, will be keys to our joint and future success.
“In addition, we are excited about Horizon’s ability to offer mobile and internet banking services to our customer base and higher lending limits to help us serve the business and agricultural communities.”
In keeping with Horizon’s closely held belief to hire and retain local talent, Horizon will name Sherri McGraw, Senior Vice President, Central National Bank & Trust, as Horizon’s Market President.
Sherri McGraw said: “I am very excited about our merger with Horizon and all of the new opportunities it will bring to the community, and I want to assure our customers that I will be here to personally serve them and all of their banking needs.”
The merger is expected to close in the fourth quarter of 2016, subject to approval by bank regulatory authorities and the shareholders of CNB Bancorp, as well as the satisfaction of other customary closing conditions. Central National Bank & Trust will be merged with and into Horizon Bank, and the combined operations will be continued under the Horizon Bank name.
Following the merger, and after the data processing and systems conversion is complete, the customers of Central National Bank & Trust will be able to access the product and service line-up offered by Horizon Bank.
McAdams said: “The depth of offerings we will be able to provide after our banks become one is tremendous. Services like mobile banking, remote check deposit, expanded agriculture and mortgage loan products, cash management services for businesses and investment services for both businesses and individuals – just to name a few – will be fantastic additions to the personal service we already provide our customers.”
Horizon Bancorp was advised by the law firm of Barnes & Thornburg. CNB Bancorp was advised by the law firm of SmithAmundsen and the investment banking firm Renninger & Associates.