United Bankshares in Charleston, W.Va., has agreed to buy Carolina Financial in Charleston, S.C.
The $19.8 billion-asset United said in a press release Monday that it will pay $1.1 billion in stock for the $4 billion-asset parent of CresCom Bank. The deal, which is expected to close in the second quarter, priced Carolina Financial at 207% of its tangible book value.
United will have more than 200 branches and $25 billion in assets when the deal is completed.
“We are excited about our partnership … and the opportunities it affords both organizations,” Richard Adams, United’s chairman and CEO, said in the release.
“Our companies share complementary cultures, a commitment to our customers, and a focus on serving our communities,” Adams added. “This transaction represents a significant step towards continuing to grow United’s presence in the Carolinas.”
United entered North Carolina and South Carolina in 2017.
Jerry Rexroad, Carolina Financial’s CEO, will join United as a director and as chairman of United’s Carolinas franchise. He will also remain chairman of Crescent Mortgage in Atlanta.
United said it expects the deal to be 7.5% accretive to its 2020 earnings per share. It should take less than three years for United to earn back an expected 3.4% dilution to its tangible book value.
United plans to cut a quarter of Carolina Financial’s annual noninterest expenses. The company expects to incur $52 million in merger-related expenses.
Carolina Financial has a pending agreement to buy the $623 million-asset Carolina Trust in a deal expected to close by the end of this year.
Sandler O’Neill and Bowles Rice advised United. Raymond James and Nelson Mullins Riley & Scarborough advised Carolina Financial.
