Banc One Corp. said Friday that it had agreed to acquire Key Centurion Bancshares, the largest banking company in West Virginia, for about $536 million in stock.

The deal would make West Virginia the eighth state in Banc One's expanding empire. Including Key Centurion's $3 billion in assets, Ohio-based Banc One would have $74.7 billion in assets when pending acquisitions are completed, ranking seventh in the nation.

As of March 31, Banc One ranked 11th with $48.7 billion in assets.

Share Price Recovery Expected

Banc One's letter of intent to buy Key Centurion, a consistently profitable holding company based in Charleston, caught analysts by surprise. Most agreed Banc One could easily absorb its latest quarry.

"This is more of a typical Banc One transaction, and I can't imagine it would hurt the price of the stock," said Frank Anderson, a banking analyst with Stephens Inc., Little Rock, Ark.

The agreement came only weeks after Banc One agreed to buy Valley National Corp. of Phoenix in a deal valued at $1.2 billion.

When the Valley deal was announced, Banc One chairman and chief executive John B. McCoy said the company would stay off the acquisition trail for the remainder of 1992.

Smaller Deals Possible

But William Boardman, head of mergers and acquisitions at Banc One, said Friday the company had ruled out only big transactions, and in fact would continue to consider smaller deals that would either solidify or expand its Midwest stronghold.

Mr. McCoy added that his company had been courting Key Centurion for several year.

The West Virginia company was put into play after a major investor, Marshall Reynolds, decided to sell his holdings, investment banking sources said.

Another regional banking company also was said to have bid for Key Centurion.

Under the terms of the agreement, Key Centurion shareholders can exchange each common share for 0.4783 share of Banc One common. The exchange ratio was based on $46 quote for Banc One, bringing the purchase price to about $536 million.

On Friday, Banc One shares closed down 50 cents at $46.50. The offer for Key Centurion amounted to $22.24 a share. The West Virginia company's stock price rose $1.75 Friday to $20.50.

Closing Expected in Early '93

The agreed price is 1.75 times Key Centurion's book value and the deal is expected to close during the first quarter of 1993.

The exchange ratio can be adjusted if Banc One's stock price rises above $46. The deal could be terminated if the price falls below $44.

Key Centurion earned $9.3 million during the first quarter, for a 1.24% annualized return on average assets and 12.54% return on average equity. It finished the first quarter with $301.8 million of equity, an amount exceeding 10% of assets.

Cost Savings Foreseen

Banc One said the deal would be nondilutive to Banc One shareholders even before cost savings expected from the elimination of redundant operations.

Donald McWhorter, president of Banc One said "a significant portion" of Key Centurion's assets are in markets close to those currently served by Banc One banks in twin communities across the Ohio River.

These markets incorporate some of the strongest-earning Banc One affiliates. One in Portsmouth has a 2% return on assets and the Steubenville affiliate earns over 1.7%.

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