Heartland in Iowa to enter west Texas with First Bank acquisition
Heartland Financial in Dubuque, Iowa, has agreed to buy First Bank Lubbock Bancshares in Texas.
The $9.8 billion-asset Heartland said in a press release Tuesday that it will pay $185.6 million in cash and stock for the $930 million-asset First Bank. The deal, which is expected to close in the second quarter, priced First Bank at 2.22% of its tangible book value.
The acquisition will create Heartland’s eleventh community bank charter and introduce the company to west Texas. It is the second deal announcement in the past month for Heartland as it nears $10 billion in assets.
FirstBank has eight branches, $652 million in loans and $824 million in deposits. The company also originates mortgages through unit PrimeWest Mortgage.
“We are highly impressed with the people and performance of FirstBank … and the solid community banking franchise they have built in Lubbock,” Lynn Fuller, Heartland’s chairman and CEO, said in the release.
“When we first became acquainted over two years ago, it was immediately apparent that a partnership … would be an excellent way for us to establish a sizable presence in Texas and a platform for further expansion,” Fuller added.
Heartland said it expects the deal to be accretive to its earnings per share within the first year of combined operations. It should take 3.6 years for Heartland to earn back any dilution to its tangible book value.
Barry Orr, president and CEO of First Bank, will lead the operations for Heartland Texas.
Panoramic Capital Advisors and Dorsey & Whitney advised Heartland. Stephens and Fenimore, Kay, Harrison, & Ford advised First Bank.