Colony Bankcorp in Fitzgerald, Ga., has agreed to buy SouthCrest Financial in Atlanta.
The $1.8 billion-asset Colony said in a press release Thursday that it will pay $84 million in cash and stock for the $715 million-asset SouthCrest. The deal, which is expected to close in the fourth quarter, priced SouthCrest at 140.4% of its tangible book value.
SouthCrest has nine branches, $323 million of loans and $596 million of deposits.
The deal is expected to be 24% accretive to Colony's 2022 earnings per share, excluding transaction costs. It should take less than four years for Colony to earn back any dilution to its tangible book value.
“This acquisition will allow Colony to accelerate its growth by increasing our footprint to include the attractive northern Georgia markets and additionally provide us access to the highly populous suburban Atlanta markets,” Heath Fountain, Colony’s president and CEO, said in the release.
“Colony has built a reputation for responsive, high-quality customer service, and in that regard, our two companies share a unique alignment of core philosophies, values and ambitions that should make the integration process simple and, for SouthCrest's customers, seamless and transparent,” Fountain added.
Harold Wyatt III, SouthCrest’s chairman, and Brian Schmitt, the company’s CEO, will join Colony’s board. Schmitt will also become Colony’s executive vice chairman.
Colony said it plans to cut about 36.6% of SouthCrest’s annual noninterest expenses, or $6.4 million. The company expects to incur about $7.7 million of merger-related expenses.
Hovde Group and Fenimore, Kay, Harrison & Ford advised Colony. Janney Montgomery Scott and Alston & Bird advised SouthCrest.
