Franklin Bank Corp. in Houston has agreed to acquire Cedar Creek Bancshares Inc. of Seven Points, Tex., for about $22.6 million.
The deal, announced Tuesday, is expected to close in the fourth quarter. Approximately half of the deal would be paid in Franklin stock, and the other half in cash. The price is approximately twice Cedar Creek's book value.
The $104.5 million-asset Cedar Creek Bank would continue to operate under the Cedar Creek name. Tom Carpenter, its president and chief executive officer, would stay on as the head of the bank and would have "local decision making authority," Franklin said in the press release announcing the deal.
The $3 billion-asset Franklin also said a sufficient number of Cedar Creek shareholders have signed an agreement to vote in favor of the purchase to ensure shareholder approval.
Cedar Creek, founded in 1963, has five offices in Henderson and Navarro counties. Through the first six months of 2004 it earned $696,000, down 14% from the same period in 2003 and 58% from the 2002 period.
Franklin has purchased three Texas banks since the beginning of last year. In March it bought the $41 million-asset Lost Pines Bancshares Inc. in Smithville for $6.9 million and in 2003 it acquired $472 million-asset Jacksonville Bancorp Inc. in Jacksonville and $78 million-asset Highland Lakes Bancshares Corp. in Kingsland.
