VantageSouth Bancshares, Inc. (NYSE MKT:VSB) and Yadkin Financial Corporation (NASDAQ:YDKN) jointly announced today that they have entered into a definitive merger agreement. The combination will create the largest community bank headquartered in North Carolina with approximately $4.0 billion in assets and significant distribution and scale across the state.
In the merger, VantageSouth Bancshares, Inc. shareholders will receive 0.3125 shares of Yadkin Financial Corporation common stock for each share of VantageSouth Bancshares, Inc. common stock. At the effective date, the transaction would be valued at approximately $299 million, based on the closing price of Yadkin Financial Corporation common stock on January 24, 2014.
“It is with great enthusiasm that we announce the merger of these two strong community banks," said Joe Towell, President and Chief Executive Officer of Yadkin Financial Corporation. "This transaction creates significant value for the shareholders of both companies, provides greater convenience and services for our customers, and transforms the banking landscape in the Carolinas. We will have meaningful presence in major markets across the state including Charlotte, Raleigh-Durham, Greenville, and Wilmington while continuing our focus on our community markets."
“This merger-of-equals creates a strong community banking franchise with greater competitive advantage, profitability, and future growth potential,” said Scott Custer, VantageSouth Bancshares, Inc.'s President and Chief Executive Officer. “The breadth of the joined franchise, combined with the talent of the two teams will create exceptional service for our customers. Our companies have spent considerable time evaluating the philosophies of our two banks and the merits of this transaction and we believe we are creating a franchise with substantial upside.”
The merger is expected to generate approximately $10 million in fully phased-in annual cost savings or approximately 8% of the expected combined expense total. This estimate is after realization of standalone cost save initiatives commenced before the merger announcement. Additionally, the merger is expected to be over 15% accretive to the standalone 2015 earnings per share of both entities, excluding the impact of the potential revenue enhancement opportunities. In the merger, Yadkin Financial Corporation will be the legal acquirer and VantageSouth Bancshares, Inc. will be the accounting acquirer.