First Busey (BUSE) to Acquire Merchants & Manufacturers Bank
First Busey Corporation BUSE, the holding company for Busey Bank, announced the signing of a definitive agreement to acquire Merchants and Manufacturers Bank Corporation (”M&M”), wherein M&M Bank will merge with and into Busey Bank. The closing of the deal, subject to the approval of M&M’s shareholders, customary closing conditions and regulatory approvals, is expected in the second quarter of 2024.
The cash-cum-stock deal is valued at approximately $41.6 million, based on First Busey’s 20-day volume-weighted average closing price as of Nov 24, 2023. Under the terms of the transaction, M&M stockholders will have the right to select receiving either $117.74 in cash, 5.7294 shares of First Busey common stock, or a combination of $34.55 in cash and 4.0481 shares of First Busey common stock. Shareholder elections are subject to distribution, such that total consideration consists of nearly 71% First Busey common stock and 29% cash.
This transaction will strengthen the company’s growing presence in the Chicago suburban markets by expanding its deposit market share in DuPage and Will counties. This will also fortify its commercial banking and wealth management businesses.
The merger is expected to result in a company with $12.7 billion of combined assets, $8.3 billion of gross loans, $10.7 billion of deposits and more than $11.5 billion of wealth assets under care.
After the deal completion, M&M Bank banking centers will become branches of Busey Bank. The combined company will serve customers through more than 60 full-service locations. Among them, 21 will be based in Central Illinois markets, 18 in suburban Chicago markets, 20 in the St. Louis metropolitan area, one in Indianapolis and three in Southwest Florida.
Van A. Dukeman, chairman, president and CEO of BUSE, commented, “With a collective, focused expertise in well-capitalized banking — built on the foundational principles of community banking — our combined franchise will pair Busey’s regionalized approach with M&M’s Life Equity Loan® products and commercial lending expertise to provide clients with personalized solutions.”
Brad W. Butler, CEO and director of M&M, stated, “We believe Busey is the right strategic partner to continue M&M Bank’s customer and community focus. We are pleased our customers will continue to experience tremendous, personalized service following the merger with Busey while benefiting from an expanded array of sophisticated commercial, consumer and wealth management services and capabilities.”
In the past six months, shares of BUSE have gained 9.1% compared with the 9.3% rise recorded by the industry.
Image Source: Zacks Investment Research
Currently, BUSE carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Inorganic Expansion Efforts by Other Banks
The all-stock merger deal between Banc of California, Inc. BANC and PacWest Bancorp PACW has received the approvals from their respective shareholders. The transaction is expected to close on or around Nov 30, 2023, as planned.
Both BANC and PACW received all necessary regulatory approvals for the merger (announced in July) last month. Per the terms of the agreement, PacWest will merge into Banc of California, and Banc of California, N.A. will merge into Pacific Western Bank.
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