SUFFOLK, Va. - TowneBank (NASDAQ: NASDAQ:TOWN) and Village Bank and Trust Financial Corp. (NASDAQCM: VBFC) announced a definitive agreement for TowneBank to acquire Village and its subsidiary, Village Bank. This move aims to expand TowneBank's presence in the Richmond MSA and leverage potential revenue synergies with Towne Financial Services Group.
The transaction, approved by the boards of both companies, is valued at approximately $120 million, with Village shareholders receiving $80.25 per share in cash. The combined entity is expected to have assets of $17.8 billion, loans of $12.1 billion, and deposits of $14.9 billion.
G. Robert Aston, Jr., Executive Chairman of TowneBank, expressed enthusiasm for the partnership, highlighting the opportunity to offer more products and services to Village Bank's clients while bolstering TowneBank's footprint in Richmond. Similarly, Jay Hendricks, President and CEO of Village, noted the merger's strategic benefit for customer value enhancement and employee opportunities.
The transaction is anticipated to be roughly 6% accretive to TowneBank's earnings per share, with full cost savings on a GAAP basis. The closure is expected in the first half of 2025, pending regulatory approval and Village shareholder consent.
Piper Sandler & Co. and Troutman Pepper Hamilton Sanders LLP are advising TowneBank, while Janney Montgomery Scott and Williams Mullen (NASDAQ:MULN) are advising Village.
Founded in 1999, TowneBank operates over 50 offices in Virginia and North Carolina, offering banking and financial services. Village Bank, also established in 1999, has nine branches in the Richmond Metropolitan area and Williamsburg, Virginia, with assets of $747.7 million as of June 30, 2024.
This press release statement contains forward-looking statements about the anticipated benefits and timing of the transaction, subject to risks, uncertainties, and other factors that could affect the outcome.
The information is based on a press release statement and is intended for informational purposes only.
InvestingPro Insights
As TowneBank (NASDAQ: TOWN) sets its sights on expansion through the acquisition of Village Bank, the financial metrics and market performance of TowneBank provide a deeper understanding of its current position. With a market capitalization of $2.5 billion and a P/E ratio that has slightly decreased to 16.42 in the last twelve months as of Q2 2024, TowneBank shows a stable valuation in the market. The company's commitment to shareholder returns is evident in its dividend track record, having raised its dividend for 12 consecutive years and maintained payments for 22 years.
InvestingPro Tips highlight that TowneBank's stock is trading near its 52-week high, with a price 96.3% of the peak, and has experienced a significant return over the last three months, with a 28.06% increase in that period. These indicators suggest a strong performance and investor confidence. Furthermore, analysts are optimistic about the company's profitability, predicting TowneBank will be profitable this year, a sentiment supported by the fact that the company has been profitable over the last twelve months.
Investors and analysts alike may be encouraged by these positive signals, as well as the additional 14 InvestingPro Tips available, which include upward earnings revisions from 2 analysts for the upcoming period. This could indicate potential for future financial growth and stability, aligning with the strategic goals outlined by TowneBank's executive leadership in the acquisition announcement.
For those interested in further insights and metrics that could impact investment decisions, additional information and tips are available at InvestingPro: https://www.investing.com/pro/TOWN.
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