Eagle in Montana to buy First Community Bancorp

Eagle Bancorp Montana in Helena has agreed to buy First Community Bancorp in Glasgow, Mont. 

The $1.4 billion-asset Eagle said in a press release Friday that it will pay $41.3 million in cash and stock for the $374 million-asset First Community. The deal is expected to close in the fourth quarter. 

First Community shareholders will be entitled to a special dividend at closing, based on certain conditions.

First Community has nine branches, two mortgage loan production offices, $307 million of deposits and $220 million of loans. 

“First Community is an experienced agriculture and commercial lender with a 130-year operating history in Montana and deep roots in the communities it serves,” Peter Johnson, Eagle’s president and CEO, said in the release. 

“This transaction expands our presence across the state of Montana and builds on our reputation as an experienced and preferred agricultural lender across the state,” Johnson added. The acquisition “provides the ability to create revenue and cost synergies while offering First Community … customers broader product offerings, increased lending limits, and an expanded branch delivery system that stretches throughout the state of Montana.”

Sam Waters, First Community’s chairman and president, will join Eagle’s board. Kris Simensen, CEO of First Community Bank, will serve as Eagle’s northeast Montana regional market president. 

The deal is expected to be 12% accretive to Eagle’s 2022 earnings per share. It should take Eagle less than four years to earn back any dilution to its tangible book value. 

Eagle plans to cut about a quarter of First Community’s annual noninterest expenses. The company expects to incur $4 million of merger-related expenses. 

Eagle was represented by Nixon Peabody and D.A. Davidson. First Community was advised by Ballard Spahr and ProBank Austin.