First Financial Bancorp and MainSource Financial Group, Inc. announced the signing of a definitive merger agreement under which MainSource will merge into First Financial in a stock-for-stock transaction. MainSource Bank, a wholly owned subsidiary of MainSource, will merge into First Financial Bank, a wholly owned subsidiary of First Financial.
Under the terms of the merger agreement, shareholders of MainSource will receive 1.3875 common shares of First Financial common stock for each share of MainSource common stock. The closing price of First Financial on July 25, 2017 was $28.10. Including outstanding options and warrants on MainSource common stock, the transaction is valued at approximately $1.0 billion. Upon closing, First Financial shareholders will own approximately 63% of the combined company and MainSource shareholders will own approximately 37%, on a fully diluted basis.
Claude Davis
First Financial and MainSource consider this partnership an ideal strategic, financial and operational fit, particularly given their respective strong and consistent performance over time. The merger will position the combined company to better serve the complementary geographies of Ohio, Indiana and Kentucky, and create a preeminent community bank in the region.
Combined, the bank is anticipated to become the sixth largest bank in deposit market share in the state of Indiana and the fourth largest in the Greater Cincinnati area. Additionally, through a recent acquisition by MainSource Bank, both companies will fulfill their plans to expand in the Louisville, Kentucky market.
The merger will result in a combined company with approximately $13.3 billion in assets, $8.9 billion in loans, $10.0 billion in deposits and $4.0 billion in assets under management, utilizing financial information as of June 30, 2017. The transaction will allow the combined company to better meet the needs of its communities in a rapidly changing banking environment, while providing the efficiencies and scale required to comply with regulatory requirements and costs associated with crossing the $10 billion asset threshold.
Archie Brown
“By taking the best of both banks, we believe that the combined company will be even more effective in meeting the lending, economic development and financial education needs of the communities we serve,” said Claude E. Davis, Chief Executive Officer of First Financial. “With both companies having proven records of success in organic performance as well as through acquisitions, we see this as a tremendous opportunity to partner with MainSource to create a new company that is even better positioned for growth and continued success.”
“We are pleased to partner with a company that has a shared vision, culture and focus on performance,” said Archie M. Brown, Jr., Chairman, President and Chief Executive Officer of MainSource. “Our client- focused approaches and similar business models delivered across corresponding footprints position us to perform well and produce top-quartile results.”
The summary:
• First Financial Bancorp and MainSource Financial Group have agreed to partner to form a new, preeminent community bank in Ohio, Indiana and Kentucky.
• The merger will combine two high-performing Midwest community banks to create a $13 billion institution with scale and strength in commercial and retail banking, wealth management and specialty finance.
• The companies’ mutual understanding of markets, shared credit culture and common banking approach create an excellent fit for both organizations.
• Claude E. Davis will transition into the role of Executive Chairman and Archie M. Brown, Jr. will serve as President and Chief Executive Officer of the merged entity.
• The new combined company will operate as First Financial Bank and will be headquartered in Cincinnati, Ohio.
