The combined company is expected to have total assets worth $17.5bn, loans of $10.9bn and deposits of $14.5bn, based on financials reported on 30 June 2022
TowneBank to acquire Farmers Bank. (Credit: Scott Graham on Unsplash)
TowneBank has agreed to acquire Farmers Bankshares, the holding company of Windsor, Virginia-based Farmers Bank, in an all-share transaction valued at $56m.
Under the terms of the merger deal, both Farmers Bank and its parent company Farmers Bankshares will merge with and into TowneBank.
TowneBank would issue 0.6050 shares of its common stock to Farmers’ shareholders, against each share of Farmers common stock held.
The exchange ratio implies a purchase price of $17.82 per share, a total consideration of $56m, based on TowneBank’s 20-day average stock price of $29.46 ending 17 August 2022.
The combined company is expected to have total assets worth $17.5bn, loans of $10.9bn and deposits of $14.5bn, based on financials reported on 30 June 2022.
Boards of directors of both Farmers and TowneBank approved the merger agreement.
The merger is expected to close in the first quarter of 2023, subject to customary conditions, including regulatory approval as well as the approval of Farmers’ shareholders.
TowneBank executive chairman G Robert Aston, Jr. said: “Our TowneBank family is humbled and excited to join hands with our long-time friends at Farmers.
“We believe our partnership can bring additional products and expanded services to the clients of Farmers Bank while helping our communities grow and prosper.”
Farmers CEO Vernon Towler said: “We feel privileged to partner with our neighbours at TowneBank. They share with Farmers Bank a commitment to philanthropy and community engagement. TowneBank is an incredibly strong organization.”
Established in 1919, Farmers Bank is a community bank that operates through eight branches and services areas throughout Tidewater Virginia.
With the acquisition of Farmers Bank, TowneBank is positioned to strengthen its market share in the Virginia Beach-Norfolk-Newport News metropolitan area.
In addition, the merger will add Isle of Wight and Southampton counties to the company’s service area, along with expanding Towne Insurance revenues.
Raymond James & Associates served as financial advisor and Troutman Pepper Hamilton Sanders as legal counsel to TowneBank, while Piper Sandler & Co. served as the financial advisor and Williams Mullen as legal counsel to Farmers, on this transaction.
Established in 1999, TowneBank offers a complete range of banking and other financial services, through its more than 40 banking offices.