Pinnacle Financial Partners in Nashville, Tenn., has agreed to buy Magna Bank in Memphis, Tenn.
The $6.3 billion-asset Pinnacle will pay $83 million in cash and stock for the $595 million-asset Magna. The deal is expected to close early in the fourth quarter.
Magna has five branches and 14 mortgage lending offices in Memphis and middle Tennessee. The bank's first-quarter earnings rose 33% from a year earlier, to $1.4 million.
Kirk P. Bailey, Magna's chairman, president and chief executive, will become Memphis chairman and join Pinnacle's senior leadership team. He will report to Terry Turner, Pinnacle's president and chief executive. Pinnacle also plans to retain several other top Magna executives.
Pinnacle said in a press release late Tuesday that the deal will be immediately accretive to its tangible book value, adding that the acquisition should help boost next year's earnings by about 3%. The company also said it is aiming to have $2.5 billion in assets in the Memphis area over time.
"Memphis is the largest city and second-largest MSA in the state, and the Magna acquisition will complete our current geographic market expansion plans," Turner said in the release. "We see ample opportunities in Memphis, where the competitive landscape is virtually identical to the markets where we historically have been successful - Nashville and Knoxville."
Sandler O'Neill and Bass, Berry & Sims advised Pinnacle. Stephens Inc., SunTrust Robinson Humphrey and Wyatt Tarrant & Combs advised Magna.