Calling it a “merger of equals,” First Horizon National Corp. of Memphis and Lafayette, La.-based Iberiabank Corp. announced an all-stock deal valued at $9 billion ahead of Monday’s (Nov. 4) opening bell that will combine the operations of both banks to create a regional financial colossus with $75 billion in assets, $57 billion in deposits, and $55 billion in loans.
Under terms of the agreement, which was unanimously approved by the boards of both companies, the combined holding company and bank will operate under the First Horizon name and will be headquartered in Memphis, Tenn.
Iberiabank operates with 16 branches in 11 different cities and towns in the state of Arkansas, including locations in the Little Rock market. The bank also has 172 more offices in eight states. Although First Horizon has no physical locations in Arkansas, the Memphis-based regional bank that operates under the First Horizon and First Tennessee Bank brand does offer insurance through local agents.
Once the transaction is completed, the combined company will be one of the largest financial services companies headquartered in the South and one of the top 25 banks in the U.S. in deposits.
Under the merger terms, Iberiabank shareholders will receive 4.584 shares of First Horizon for each share of company stock they own. First Horizon shareholders will own 56% and Iberia shareholders will own 44% of the combined company. Additionally, Iberiabank shareholders will receive a 43% increase in their dividend after consummation of the transaction, based upon each company’s current dividend per share.
As of Friday’s stock closing prices, First Horizon had a market capitalization of $5.08 billion and Iberiabank’s market cap was $3.94 billion.
“Our merger of equals with IBERIABANK is an exciting milestone and the logical next step in the continued successful transformation of our company. Separately, we are both formidable organizations with strong track records, great businesses and talented bankers. Together, First Horizon and IBERIABANK will create a powerful new company driven by our shared commitment to our customers, communities, shareholders and the employees we serve,” said First Horizon Chairman and CEO Bryan Jordan. “We are pleased to have a partner with a complementary people-focused culture, shared values and a growth-oriented business model. Our combined new scale, deep experience in financial services and diverse business mix in the South uniquely position us to accelerate our growth and create lasting shareholder value.”
Added Iberiabank President and CEO Daryl Byrd: “This merger of equals represents an exciting next chapter for both companies. By joining forces with First Horizon, we will create an organization that has the resources to invest in advanced technologies and expand lending capacity and product offerings for our combined clients.”
“We chose a partner who values deep relationships and is culturally aligned with our core mission, which is to create a great place to work for employees, deliver extraordinary, value-based client service, meet the expectations of our shareholders and invest in the communities we serve,” continued Byrd. “Our partnership will leverage our best-in-class workforce and build on and complement the well-established strong foundations of both organizations. We look forward to bringing our companies together to better serve our clients and communities.”