Southside Bancshares, Inc. and Diboll State Bancshares, Inc. to Merge - Southside Expands East Texas Footprint
TYLER and DIBOLL, Texas, June 12, 2017 – Southside Bancshares, Inc. (Nasdaq: SBSI), parent company of Tyler, Texas-based Southside Bank and Diboll State Bancshares, Inc., the holding company for Diboll, Texas-based First Bank & Trust East Texas, announced today that they have signed a definitive agreement under which Diboll State Bancshares, Inc. will merge into Southside Bancshares, Inc. and First Bank & Trust East Texas will merge into Southside Bank. The combined company will have nearly $7 billion in assets.
Under the terms of the agreement, Diboll State Banc shares, Inc. shareholders will receive, in aggregate, 5,535,000 shares of Southside common stock and up to $25 million in cash. Based on Southside Bancshares, Inc.’s closing stock price of $35.01 on June 12, 2017, the value of consideration to Diboll State Bancshares, Inc. shareholders would be $218.8 million in the aggregate.
“We are excited to partner with a superb bank like First Bank & Trust East Texas. This merger is an excellent growth opportunity to further expand our footprint in the dynamic East Texas market, complementing our presence in North Texas and Austin,” said Lee Gibson, President and CEO of Southside Bank and Southside Bancshares, Inc. “Jay Shands and the First Bank & Trust East Texas leadership team have built a strong organization focused on providing exceptional customer service and an unwavering commitment to communities. Our companies share many of the same values, making this merger a natural fit from a geographic, cultural, financial and strategic standpoint.”
The merger has been unanimously approved by the boards of directors of both companies and is expected to close during the fourth quarter of 2017, after receipt of regulatory approvals, the approval of the shareholders of Diboll State Bancshares, Inc. and the satisfaction of other customary closing conditions. The combined entity will operate under the names Southside Bancshares, Inc. and Southside Bank.
Following the closing of the merger, two Diboll State Bancshares, Inc. board members will join the Southside board, which will be expanded to 17 members. Diboll State Bancshares, Inc.’s executive management team will remain in place after the merger, assuring the continuity of local decision making. Diboll State Bancshares, Inc. executives will assume the following titles:
Jay Shands – Regional President, East Texas; Trey Denman – Executive Vice President; Jim Denman – Executive Vice President.
“We are excited about the opportunity to join Southside, as both companies operate strong community banking models,” said Jay Shands, Chairman, President and CEO of Diboll State Bancshares, Inc. “Bringing together our companies will help provide our customers and employees a broader suite of products and services, increased branch locations and greater financial support to execute our strategy. This merger is a great outcome for our shareholders and positions us well for sustainable success over the long term.”
The transaction is expected to be accretive to earnings per share in the first full year after closing.
Both Southside Bank and First Bank & Trust East Texas are well-capitalized banks and the proforma company is expected to be well-capitalized following the transaction.
Southside Bancshares, Inc. was advised in this transaction by Keefe, Bruyette & Woods, A Stifel
Company, as financial advisor and Alston & Bird LLP as legal counsel. Diboll State Bancshares, Inc. was advised by Hovde Group, LLC as financial advisor and Fenimore, Kay, Harrison & Ford, LLP as legal counsel.
In addition to the information contained in this press release, on June 12, 2017, Southside will publish a presentation to investors regarding the transaction on its website at www.southside.com.
About Southside Bancshares, Inc.
Southside Bancshares, Inc. is a bank holding company with approximately $5.7 billion in assets that owns 100% of Southside Bank. Southside Bank currently has 60 banking centers in Texas and operates a network of 70 ATMs.