Entegra Financial in Franklin, N.C., has agreed to buy Oldtown Bank in Waynesville, N.C.
The $984 million-asset Entegra said in a press release Tuesday that it will pay about $13.5 million in cash for the $113 million-asset Oldtown. The deal is expected to close in the first quarter.
Oldtown, which was formed in 2007, has one branch, $65 million in loans and $92 million in deposits.
"This transaction utilizes a portion of our excess capital as we execute on our strategy of selective expansion into contiguous markets and seeking acquisition opportunities with reasonable earn back periods that are accretive to earnings and return on equity," Roger Plemens, Entegra's president and chief executive, said in the release. "We see Oldtown as a natural complement to our existing footprint in western North Carolina and upstate South Carolina."
Entegra said it expects the transaction to be "significantly accretive" to earnings per share and return on equity. It should take the company about 2.5 years to earn back any dilution to tangible book value.
Entegra was advised by Sandler O'Neill and Brooks, Pierce, McLendon, Humphrey & Leonard. Oldtown was advised Ward and Smith; it received a fairness opinion from Equity Research Services.
