Bankshares of Fayetteville Inc., the holding company for The Bank of Fayetteville, will be bought later this year by Stuttgart-based Farmers and Merchants Bankshares Inc., holding company for The Farmers & Merchants Bank.
The value of the all-cash deal, subject to regulatory and shareholder approval, was not disclosed. It is expected to be finalized in the fall, and the acquisition will push FMB’s total assets over $1 billion.
President and CEO Gary Hudson said entering the Northwest Arkansas market will provide FMB the opportunity to diversify. Agricultural lending accounts for about a third of the bank’s business, Hudson said, making FMB one of the largest agri lenders in the state.
“We are looking forward to becoming part of the great community of Fayetteville,” said Hudson, who started his bank career as a trust officer at FMB in 1980. He began a second stint at the bank in 2002, and was elevated to president and CEO in 2010. “During our 70-year history, we have earned a reputation for community service and investment that fits well with the philosophy of The Bank of Fayetteville. Our board and officers have many decades of commitment to meeting the financial needs of our customers, as well as our stockholders.”
Hudson said BOF, which is headquartered in Fayetteville’s downtown square and opened on June 5, 1987, will keep its name on its eight Northwest Arkansas branches and operate as a division of FMB, which was founded in 1945.
“We feel like it has great franchise value, and we want to build on that reputation,” he said.
Hudson said all BOF employees will be kept on through the end of June 2016 before further evaluations.
As of March 31, according to the Federal Deposit Insurance Corp., BOF had 106 employees and $348.3 million in assets. It has five branches in Fayetteville and one each in Farmington, West Fork and Prairie Grove.
FMB had assets of $670.3 million as of March 31, and 143 employees. The bank currently operates in seven Arkansas cities: Stuttgart, DeWitt, Marianna, Hazen, Des Arc, Perryville and Morrilton.