First Farmers and Merchants in Columbia, Tenn., plans to buy out some of its shareholders and deregister as a publicly traded company.

The $1.2 billion-asset company plans to will pay cash to shareholders who own less than 400 shares of its stock. The amount to be paid will be determined at a later date by the company's board, based on an independent valuation.

The move will reduce First Farmers' total number of shareholders to less than 1,200, allowing it to suspend regulatory reports to the Securities and Exchange Commission.

First Farmers said in a press release that the plan should "result in significant savings in legal, accounting and administrative expenses" for the holding company and its bank. First Farmers did not provide an estimate of its cost savings.

"As we examined the relative advantages and disadvantages of our public status, it became apparent that the compliance and reporting costs outweighed the potential benefits of SEC registration," Randy Stevens, the company's chairman and chief executive, said in the release.

The plan is subject to approval by shareholders at First Farmers' next annual meeting. First Farmers expects to complete the transaction in the second quarter.

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