Community Trust Bancorp Inc. in Pikeville, Ky., is buying its way into Tennessee.
The $3.2 billion-asset company announced late Tuesday that it had agreed to buy the privately held LaFollette First National Corp. for $16.1 million in cash, or $650 a share, about 1.05 times LaFollette's tangible book value.
Under the deal, set to close in the fourth quarter, the $184 million-asset First National Bank of LaFollette would be merged into Community Trust Bank Inc.
Community Trust has a business presence but no physical operations in Tennessee. LaFollette has four branches; Community Trust's 70 branches are in Kentucky and West Virginia.
Daniel Cardenas, an analyst with Howe Barnes Hoefer & Arnett Inc., said the expansion makes sense for Community Trust. "It is an area that they've wanted to be in for a while. This allows them to dip their toe into the water a bit," Cardenas said in an interview Wednesday.