The $2.9 billion-asset Bank
First said in a press release Tuesday that it will pay $124 million in cash and
stock for the $628 million-asset Hometown. The deal, which is expected to close
in the fourth quarter, valued Hometown at 213% of its tangible book value.
Hometown has $421 million
of loans and $539 million of deposits.
Bank First said Hometown’s
shareholders and customers will benefit from its minority stake in UFS, a bank
technology outfitter that provides digital, core, cybersecurity, managed IT and
cloud services to Midwestern banks.
Tim McFarlane, Hometown’s president
and CEO, will become Bank First’s president and will join its board.
The deal is expected to be
13% accretive to Bank First’s earnings per share in the first full year of
operations, including cost savings. It should take a little over two years for
Bank First to earn back any dilution to its tangible book value.
Bank First plans to cut
about 40% of Hometown’s annual noninterest expense. The company expects to
incur $8.7 million of merger-related expenses.
Piper Sandler and Alston
& Bird advised Bank First. Reinhart Boerner Van Deuren advised Hometown.
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