Pine Bluff-based Simmons First National Corp. announced Monday (June 7) it will acquire Landmark Community Bank and Triumph Bancshares, two Tennessee banks, in a combined transaction worth $277.9 million.
Landmark Community Bank is based in Collierville, Tenn., and Triumph Bancshares, Inc. is based in Memphis, Tenn. Based upon deposit market share on a pro forma basis, the proposed Landmark and Triumph transactions will create the 9th largest bank in Tennessee, while pushing Simmons’ ranking in Memphis from 35th to 6th and in Nashville from 20th to 15th.
Simmons officials said they are reviewing plans for expanding branch coverage in Memphis as a result of the deal.
“Landmark and Triumph are two successful, local community banks who share our philosophy of a strong credit culture, significant community involvement and a passion for delivering excellent customer service,” said George A. Makris, Jr., Simmons’ chairman and CEO. “The opportunity to combine forces with these two institutions also highly complements our existing footprint in Tennessee and enhances our scale in two of our key growth markets – Memphis and Nashville. In addition to cultural and geographic synergies, the financial metrics of these mergers are compelling and consistent with our M&A strategy of partnering with high-quality banks within our current footprint that represent an efficient use of our capital and delivers on our commitment of building long-term value for our shareholders. We’re very excited to welcome our newest partners to the Simmons organization.”
“We believe the opportunity to join the Simmons team is very positive for Landmark’s stakeholders,” said James “Jake” Farrell, Landmark’s chairman, president and CEO. “We are excited to become part of the Simmons organization, and we look forward to using Simmons’ resources to strengthen and expand our business while continuing to provide locally focused banking services to our customers. With access to Simmons’ broader array of consumer and commercial products, combined with their leading-edge digital capabilities, we will be able to provide greater benefits to our customers and the communities we serve.”
“For years, Triumph Bank has put its clients at the center of its focus, and partnering with Simmons provides our organization with the ability to continue to grow with our clients and meet their changing needs,” said William J. Chase, Jr., Triumph’s president and CEO. “In addition to being able to offer our clients a wider breadth of banking products and services, we will have a greater capacity to lend while continuing to deliver the same excellent customer service and active community involvement.”
Simmons’ proposed transaction with Landmark includes consideration consisting of a mixture of cash and Simmons’ common stock valued at approximately $146.3 million (based on the Company’s June 4, 2021 closing price), subject to certain conditions and potential adjustments.
Simmons’ proposed transaction with Triumph also includes consideration consisting of a mixture of cash and Simmons’ common stock valued at approximately $131.6 million (based on the Company’s June 4, 2021 closing price), subject to certain conditions and potential adjustments. T
The cash consideration in both Proposed Transactions will be used primarily for payments to Landmark’s and Triumph’s respective optionholders.
Simmons said the combined purchase price for the proposed transactions is estimated at approximately 147% of the combined tangible book value of Landmark and Triumph (as of March 31, 2021).
Simmons estimates, on a combined basis, the additions of the two banks will be approximately 7.5% accretive to earnings per share in 2022 after one-time expenses. While revenue synergies have been identified, they have not been included in estimates.
The respective boards of both banks have approved the sales. Simmons expects to close the transactions during the fourth quarter of 2021 subject to customary regulatory approval and closing conditions.
Stephens Inc. served as financial advisor to Simmons, Mercer Capital Management, Inc. provided Simmons with fairness opinions, and Covington & Burling LLP served as Simmons’ legal advisor. Olsen Palmer LLC served as financial advisor to Landmark, and Baker, Donelson, Bearman, Caldwell & Berkowitz, PC served as Landmark’s legal advisor. Southard Financial, LLC served as financial advisor to Triumph, and Farris Bobango PLC served as Triumph’s legal advisor.
Shares of Simmons First National Corp. (NASDAQ: SFNC) were trading higher on Monday at over $31 per share. The company’s stock has traded between a low of $14.84 and a high of $33.43 over the past year.