The transaction is expected to be completed in the second quarter of 2020
Louisiana-based Investar Holding, the parent company of Investar Bank, has agreed to acquire Cheaha Financial Group and its subsidiary Cheaha Bank for nearly $41.1m.
Headquartered in Oxford, Cheaha Bank provides a full range of banking products and services to individuals and small businesses across four branch locations in Calhoun County, Alabama.
Cheaha Bank had $117.2m of net loans and $177.1m in deposits as of 30 September. The bank had $206.7m in total assets as of the end of the third quarter this year.
Cheaha president and CEO Shad Williams said: “We were only interested in a merger partner that believed in the deep relationships between the bank and the community it serves.
“Investar is that organization and I believe we are extremely fortunate to have found such a stellar partner for our employees and community. We love its commitment to Alabama and strong culture.”
Investar also said it plans to sell $30m of common stock to institutional and other accredited investors as part of a private placement.
Investar Bank operates 28 full-service branches
Headquartered in Baton Rouge, Investar Holding Corporation through its banking subsidiary, Investar Bank offers full banking services, excluding trust services.
Currently, Investar operates 28 full-service branches and had 285 full-time equivalent employees as of 30 September 2019.
Investar president and CEO John D’Angelo said: “We are extremely excited to join forces with Cheaha to continue to provide its customers and community with exemplary service.
“The leadership team at Cheaha has done an extraordinary job operating the bank, and we are confident that they will make a great addition to the Investar family.
“This merger significantly enhances our presence along the I-20 corridor in Alabama and complements our recent acquisition of Bank of York.”
The deal has been approved by the board of directors at both the banks.
The transaction is expected to be completed in the second quarter of 2020, which is subject to customary conditions, including regulatory approvals and approval by the shareholders of Cheaha.
For the Cheaha transaction, Janney Montgomery Scott served as financial advisor while Fenimore, Kay, Harrison & Ford acted as legal counsel to Investar.
On the other hand, Maynard Cooper & Gale acted as legal counsel to Cheaha and National Capital, provided the fairness opinion for Cheaha.