SPARTA — Five months after closing one acquisition, ChoiceOne Financial Services Inc. now plans to do another.
The Sparta-based ChoiceOne and Muskegon-based Community Shores Bank Corp. (Nasdaq: CSHB) today said they signed a definitive agreement for a cash-and-stock deal valued at $21.9 million. ChoiceOne’s acquisition of Community Shores could close in the second quarter, pending regulatory and shareholder approvals.
Community Shores Bank has $204 million in assets and operates from three offices in Muskegon County and one in Grand Haven in neighboring Ottawa County.
“Joining forces with Community Shores is a natural geographical and cultural fit for ChoiceOne. It allows ChoiceOne to extend our footprint into Muskegon and Ottawa counties and enhance the commitment that both Community Shores Bank and ChoiceOne Bank have to our Michigan customers and communities,” ChoiceOne CEO Kelly Potes said in a statement.
ChoiceOne (OTC: COFS) closed in fall 2019 on an $89 million deal for Lapeer-based County Bank Corp., the parent company of Lakestone Bank & Trust. That deal gave ChoiceOne 28 offices on western and southeastern Michigan with assets of about $1.3 billion.
Under the terms of the new deal, Community Shores shareholders have the right to receive an amount equal to $5 in cash or 0.12161 shares of ChoiceOne stock for each of their shares.
Community Shores Bank’s consolidation into ChoiceOne Bank could occur in the second half of 2020. If the deal is approved, Community Shores CEO and President Heather Brolick will join ChoiceOne Bank as senior vice president of human resources and Chief Lending Officer Brent McCarthy would become vice president and Muskegon market executive.
“With similar cultures, values and commitments to our local communities, this merger will allow both organizations to better serve our customers in Muskegon and Ottawa counties,” Brolick said. “Both ChoiceOne Bank and Community Shores Bank have deep roots in West Michigan. This merger will allow us to enhance our impact on the local community, as well as combine our service cultures and ChoiceOne’s technology enhancements to better serve our customers.”
Community Shores Bank recorded net income of $849,000 through the third quarter of 2019 and $1.1 million in 2018, according to a quarterly FDIC financial report.
ProBank Austin is serving as financial adviser and Dickinson Wright PLLC is legal counsel for Community Shores Bank. Grosse Pointe-based Donnelly Penman & Partners Inc. is serving as financial adviser and Grand Rapids-based Warner Norcross + Judd LLP is serving as legal counsel to ChoiceOne Financial Services.