Expanding its presence in neighboring Kansas, Missouri-based Commerce Bancshares agreed Tuesday to buy $650 million-asset Union Bancshares for $86.6 million in cash.

The price equals nearly 190% of Union's book value, or about 14 times the Wichita-based company's estimated 1994 earnings. The deal was struck without the help of investment bankers. It is expected to close in the first quarter of 1995.

Commerce said the purchase would be minimally dilutive of 1995 earnings per share (less than 1%) and would be accretive to earnings in 1996. The $7.9 billion-asset company, based in Kansas City, declined to specify either the amount of goodwill it would incur or an estimate of overhead cuts.

JoSeph Stieven, with Stifel, Nicolaus & Co., said the deal "easily makes financial sense." Commerce is gaining a well-managed bank in an attractive market, he added.

William G. Watson, Union's president and chief executive, will take a management role after the merger. Following the deal, Commerce will have 36 offices and $1.3 billion of assets in Kansas, the third-largest banking presence in the state.

Union Bancshares earned $4.6 million in the first nine months of 1994, for annualized returns of 1.01% on average assets and 14.4% on average equity. Commerce Bancshares earned $71.8 million in the same period, for annualized returns of 1.23% on assets and 12.93% on equity.

In the Southeast, meanwhile, Crestar Financial Corp. said it formalized its previously announced acquisition, a $53.2 million agreement to buy TideMark Bancorp of Newport News, Va.

The agreement calls for Crestar to pay $5.50 a share in either cash or Crestar common stock for each of the 6.9 million TideMark shares currently outstanding.

Crestar will pay two times book value for TideMark, but the acquisition is expected to begin producing earnings quickly. The company has wrung cost savings of more than 50% from previous thrift acquisitions, according to analysts.

"This has gotten to be pretty cookie-cutter for them," said Robinson Humphrey's John Coffey.

TideMark Will add nine branches and nearly $300 million in deposits to Crestar's presence in southern Virginia.

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