Atlanta-based Georgia Banking Co. Inc. agreed to merge with in-state peer Peoples Banktrust Inc. in a cash-and-stock transaction valued at roughly $58 million.
Under the terms of the deal, shareholders of Buford, Ga.-based Peoples will receive a mix of cash and convertible preferred stock, and Peoples Director Larry Cheek will join the Georgia Banking board.
At announcement, S&P Global Market Intelligence calculates the deal value to be 135.22% of common equity and of tangible common equity, 13.21% of assets, 14.76% of deposits and 14.84x earnings. The tangible book premium-to-core deposits ratio is 4.99%.
Market Intelligence valuations for bank and thrift targets in the Southeast region between Nov. 10, 2020, and Nov. 10, 2021, averaged 151.55% of book and 159.39% of tangible book, and had a median of 14.16x last-12-months earnings, on an aggregate basis.
As of Sept. 30, the combined bank would have about $1.2 billion in pro forma deposits, representing a top-five market share for banks based in the Atlanta Metropolitan Statistical Area; pro forma total assets of about $1.4 billion; and gross loans of about $800 million, according to a press release.
The merger, which is expected to close in the first quarter of 2022, is intended to improve the combined bank's scale and expand its footprint across the Gwinnett County market.
Based on Market Intelligence data, with the completion of the transaction, Georgia Banking will enter Gwinnett County, Ga., with one branch to be ranked No. 15 with a 1.7% share of approximately $23.12 billion in total market deposits.
Peoples has about $439 million in assets, $393 million in deposits and $151 million in loans as of Sept. 30, according to the press release.
Evercore acted as exclusive financial adviser and Troutman Pepper acted as legal counsel to Georgia Banking in the transaction. Performance Trust Capital Partners served as exclusive financial adviser and Nelson Mullins served as legal counsel to Peoples.
Georgia Banking unit Georgia Banking Co. was recapitalized by an investor group led by Bartow Morgan Jr. in February. The new ownership group raised $180 million to fund the bank's growth.
