On Tuesday,the South-East bank, BancorpSouth, Inc. BXS announced further delay in completion of its two merger deals entered last year in January. The deals entered with Central Community Corporation and Ouachita Bancshares Corp. have been extended to Dec 31, 2015 without any changes in terms of the agreement.
The merger agreements have received approval from the boards of directors of all three companies along with the shareholders of Central Community Corporation and Ouachita Bancshares Corp. However, the delay remains subject to regulatory approvals and other closing conditions.
In Apr 2015, BancorpSouth re-filed merger applications with the concerned regulatory authorities. The merger agreements had been postponed in Jul 2014, to until Jun 30, 2015, due to certain compliance issues with the regulatory requirements.
As of Mar 31, 2015, Ouachita and Central Community reported total assets of $653.6 million and $1.4 billion, respectively, on a consolidated basis.
Background
On Jan 22, 2014, BancorpSouth had announced a definitive agreement with the Central Community, according to which, the company will issue around 7.25 million shares of its common stock along with $28.5 million cash to acquire Central Community’s stake in First State Bank, Central Community Capital Trust 1, and First Central Union Capital Trust 1.
Previously, on Jan 8, 2014, BancorpSouth had penned a merger agreement with Ouachita, the parent company of Ouachita Independent Bank, headquartered in Monroe, LA. Per the deal, the company will issue a maximum of 3.675 million shares of its common stock along with $22.875 million cash to acquire all outstanding shares of Ouachita’s capital stock.
To obtain the necessary regulatory approvals for both the deals, BancorpSouth needed to fulfill certain regulatory conditions, which caused this holdup. The completion of these mergers is expected to be beneficial for the company’s growth in the future.
BancorpSouth currently carries a Zacks Rank #3 (Hold). Some better-ranked Southeast banks include BNC Bancorp BNCN, First Horizon National Corporation FHN and CommunityOne Bancorp COB. All of these sport a Zacks Rank #2 (Buy).
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