Commercial BancGroup in Harrogate, Tenn., has agreed to buy NBN Corp. in Newport, Tenn., outbidding a rival in a bankruptcy court auction.
The $805 million-asset Commercial BancGroup agreed to pay $5.1 million for NBN, the holding company for National Bank of Tennessee, according to documents filed with U.S. Bankruptcy Court for the Eastern District of Tennessee. Other conditions could influence the final sale price, including a final assessment of cash flow at the $141 million-asset NBN.
The agreement received court approval on Jan. 20 and the sale is expected to close next month, pending the termination of a data-processing agreement between NBN and Jack Henry & Associates.
CNB Bancshares, an $878 million-asset company in Sevierville, Tenn., received court approval in October to buy NBN for $3.7 million in cash. As the stalking-horse bidder in the bankruptcy process, CNB will receive a $147,000 break-up fee as compensation for being outbid, plus reimbursement of all associated legal and financial costs.
NBN has two branches in Newport. Commercial BancGroup has 22 branches in Tennessee and Kentucky.
Burke Group and Ritchie & Powell advised NBN. Butler Snow offered legal counsel to Commercial BancGroup. Hodges, Doughty & Carson served as CNB Bancshares' legal counsel.