Bank Merger Aims To Create Big-Hitter In US Southeast

Tom Burroughes

24 January 2017

Pinnacle Financial Partners, a US holding company of BNC Bancorp and Pinnacle Bank, has announced that the two entities will merge via an all-stock transaction, taking on the Pinnacle brand.

The transaction will create a four-state footprint concentrated in 12 of the largest urban markets in the Southeast, adding significant presence in Charlotte, Raleigh, Greensboro, Winston-Salem, Greenville-Spartanburg, and Charleston to Pinnacle’s Tennessee franchise, Pinnacle Financial Partners said in a statement yesterday. BNC Bank provides services including wealth management and private banking.

Under the terms of the merger agreement, BNC shareholders will receive 0.5235 shares of Pinnacle common stock for every BNC share. All fractional shares will be cashed out as of the closing.

On a pro forma basis, Pinnacle is expected to be a top-50 public US banking franchise by assets, with $20 billion in assets, $14 billion in loans and $15 billion in deposits.

Pinnacle will operate the Carolinas and Virginia region out of BNC’s corporate headquarters in High Point, North Carolina, Pinnacle Financial Partners said.

Richard Callicutt, BNC’s president and chief executive officer, will be named chairman of the Carolinas and Virginia region once the acquisition is completed and will join Pinnacle’s board along with three other BNC directors. David Spencer, BNC’s senior executive vice president and chief Financial Officer, will be named executive vice president supporting Callicutt in growing the firm’s presence in the Carolinas and Virginia and working in the combined company’s treasury and corporate finance areas.

“BNC represents the single best platform to expand our presence in urban, high-growth metropolitan markets,” Pinnacle president and CEO M Terry Turner said.

Under the terms of the merger agreement, BNC shareholders will receive 0.5235 shares of Pinnacle common stock for every BNC share. All fractional shares will be cashed out as of the closing.

Among details of the transaction, the banks said that BNC’s outstanding stock options will be fully vested upon consummation of the merger, and all outstanding BNC options that are unexercised prior to the closing will be cashed out based on Pinnacle’s ten trading-day average closing price ending on the trading day immediately preceding the closing date.

Based on Pinnacle’s 20-day trailing average closing price as of Friday, January 20, 2017, the transaction is valued at approximately $35.70 per share, or $1.9 billion in the aggregate.