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Thursday, 15 August 2013 08:36

Mercantile Bank to merge with Firstbank of Alma in $151.5M transaction

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UPDATE: Mercantile, Firstbank uniting in ‘merger of equals’ (Updated 12:55 p.m.)

Grand Rapids-based Mercantile Bank Corp. (Nasdaq: MBWM) and Firstbank Corp. (Nasdaq: FBMI) of Alma announced today that they plan to merge in a deal valued at $151.5 million.

The combined company would have total assets around $2.8 billion, deposits of $2.3 billion and loans of $2.0 billion with 53 branches statewide. According to a press release, Firstbank shareholders would receive one share of Mercantile common stock for each share of Firstbank common stock they own. After the closing, Mercantile shareholders will own approximately 52 percent of the stock in the combined company with Firstbank shareholders owning the remaining 48 percent.

Mercantile plans to pay a dividend of $2.00 per share to shareholders before the close of the merger. The deal is expected to be accretive to Mercantile's earnings per share in 2014, and the combined company's capital ratios "will be well in excess of regulatory minimums," according to the release.

After the merger, the company will be led by mix of executives from both organizations. Michael Price will serve as president and CEO. Robert Kaminski and Charles Christmas from Mercantile and Thomas Sullivan and Samuel Stone from Firstbank will also serve on the executive team. The combined entity will use the Mercantile name and corporate headquarters in Grand Rapids.

It expects to be the third largest bank headquartered in Michigan as ranked by market capitalization and by deposit market share.

The deal is expected to close by Dec. 31 of this year pending regulatory and shareholder approvals. Keefe, Bruyette and Woods Inc. served as financial adviser to Mercantile, while Firstbank was advised by Sandler O'Neill & Partners LP.

Read 1891 times Last modified on Thursday, 15 August 2013 12:57

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