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Farmers Capital Bank to merge into WesBanco.

WesBanco (WSBC) and Farmers Capital Bank (FFKT) jointly announced that they have executed a definitive agreement and plan of merger providing for the merger of Farmers with and into WesBanco. James Gardill, chairman, and Todd Clossin, president and CEO, of WesBanco and R. Terry Bennett, chairman of the board, and Lloyd Hillard, Jr., president & CEO, of Farmers, made the joint announcement.Under the terms of the agreement and plan of merger, which has been unanimously approved by the boards of directors of both companies, WesBanco will exchange a combination of its common stock and cash for Farmers common stock. Farmers shareholders will be entitled to receive 1.053 shares of WesBanco common stock and cash in the amount of $5.00 per share for each share of Farmers common stock for a total value of approximately $378.2M in aggregate based on WesBanco's market close price of $43.03 on April 18. The merger is expected to qualify as a tax-free reorganization. The transaction values Farmers at a price to March 31, tangible book value per share of 195%, and a price to mean analyst estimated earnings per share of 17.8 times. Excluding certain one-time merger charges, the transaction is anticipated to be approximately 3% accretive to earnings in 2019, and approximately 5% accretive to earnings in 2020 once anticipated cost savings are fully phased-in. Estimated tangible book value dilution at closing of approximately 2.1% is expected to be earned back in approximately 2.4 years using the "cross-over" method, including estimated pre-tax merger-related charges of $22.3M. The acquisition is subject to the approvals of the appropriate regulatory authorities and the approval by the shareholders of Farmers. It is expected that the transaction should be completed during the second half of 2018.

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Publication:The Fly
Date:Apr 19, 2018
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