Renasant Corp. in Tupelo, Miss., has agreed to buy Brand Group Holdings in Lawrenceville, Ga.
The $9.8 billion-asset Rensasant said in a press release late Wedesday that it will pay $452.9 million in cash and stock for the $2.4 billion-asset Brand, which has been family run for more than a century. The deal, which is expected to close in the third quarter, prices Brand at 224% of its tangible book value.
Brand must sell about $55 million in classified assets before the deal closes, along with its BrandMortgage Group. If the classified assets are sold at a discount, the purchase price will be reduced on a dollar-for-dollar basis based on the after-tax difference.
Renasant will gain 13 branches, $1.8 billion in loans and $1.9 billion in deposits around Atlanta.
Renasant said the deal should provide double-digit accretion to its earnings per share once costs cuts are made. It should take less than three years to earn back any dilution to Renasant's tangible book value.
Bartow Morgan Jr., Brand's CEO, will become Renasant's chief commercial banking officer, with responsibility for commercial banking, including specialty lines and other financial services. Two Brand directors, including Morgan, will join Renasant's board.
Richard Fairey, Brand's president and chief operating officer, will become chief retail banking officer at Renasant Bank. Mike Dunlap, Brand's director of commercial banking, will become president of the Georgia commercial banking group.
"The ability to partner with a 113-year-old company with strong talent in one of the most attractive markets in the country is a tremendous opportunity,” Robin McGraw, Renasant's chairman and CEO, said in the release. “We believe this merger will significantly enhance our Atlanta presence."
Keefe, Bruyette & Woods and Phelps Dunbar advised Renasant. Evercore, Banks Street Partners and Troutman Sanders advised Brand.