CHARLOTTESVILLE, Va. and
RICHMOND, Va., Aug. 13, 2020 /PRNewswire/ -- Blue Ridge
Bankshares, Inc. (NYSE American: BRBS) ("Blue Ridge"), the parent holding company of
Blue Ridge Bank, National Association, and Bay Banks of
Virginia, Inc. (OTC: BAYK) ("Bay
Banks"), the parent holding company of Virginia Commonwealth Bank,
today jointly announced the signing of a definitive merger
agreement pursuant to which the companies will combine in an
all-stock merger to create a leading Virginia-based community bank with a pro forma
total market capitalization approaching $200
million.
Under the terms of the merger agreement, which was unanimously
approved by the Boards of Directors of both companies, Bay Banks
shareholders will receive 0.50 shares of Blue Ridge common stock
for each share of Bay Banks common stock they own. Upon completion
of the merger, Bay Banks shareholders will own approximately 54%
and Blue Ridge shareholders will
own approximately 46% of the combined company.
The combined company and bank will operate under the
Blue Ridge name and will trade
under the ticker symbol "BRBS" on the NYSE American stock
exchange. The holding company will be headquartered in
Charlottesville, Virginia, and the
subsidiary bank will be headquartered in Richmond, Virginia. As of June 30, 2020, the pro forma company would have
approximately $2.4 billion in assets,
$1.9 billion in loans and
$2.2 billion in deposits, ranking
it 4th in community bank deposit market share for
institutions under $10 billion in
assets in the Commonwealth of Virginia.
Brian K. Plum, CEO of
Blue Ridge, will continue as CEO
of the combined company. Randal R. Greene, CEO of Bay Banks,
will become the COO of the combined company and CEO of Blue Ridge
Bank. Judy C. Gavant, the current Chief Financial Officer of
Bay Banks, will become the Chief Financial Officer of the combined
company, and Amanda Story, the
current Chief Financial Officer of Blue
Ridge, will become Chief Accounting Officer. Jim McCarty, the current Chief Administrative
Officer of Blue Ridge, will
continue in that role for the combined company. The combined
company board will be comprised of thirteen members, with seven
from Blue Ridge and six from Bay
Banks, including the current chairmen and CEOs of the
companies.
"We are excited to partner with Blue
Ridge," said Randy Greene,
CEO of Bay Banks. "We have great respect for Brian, and the
company Blue Ridge has
built. Blue Ridge has achieved record revenue for the first
half of 2020 driven by strong mortgage-related income. This is
a great combination of two companies with rich Virginia histories dating back over 200 years
combined," added Greene.
"This combination creates additional resources to invest in our
communities and the technologies necessary to maintain and improve
upon our core commitment to providing responsive, client-centric
financial services," said Brian K.
Plum, CEO of Blue Ridge. "Bay Banks' combination of
longstanding dedicated service to its legacy communities with
significant success in key Virginia MSA's will diversify the
combined company's revenue and market demographics; positioning
Blue Ridge as the community bank
of choice in its markets. We remain zealously committed to
building a top-performing financial services provider passionately
dedicated to serving its communities and clients, and our
partnership with Bay Banks reinforces our momentum to fulfill that
commitment."
Financially Attractive Metrics for Shareholders:
- Significant Earnings and Tangible Book
Accretion: The transaction is projected to deliver
significant earnings accretion to both companies in 2021, assuming
75% cost savings are phased in, and will result in excess of 7%
tangible book value accretion to the surviving currency for
BRBS.
- Cost Synergies: The companies have identified
$8.2 million dollars in expected net
cost savings with 75% phased in by 2021 and 100% thereafter,
representing approximately 10.5% of the projected 2021 combined
non-interest expenses.
- Pro Forma Profitability: The combined company is
expected to achieve strong core profitability metrics of 1.20% ROAA
and 15% ROATCE in 2021, incorporating 75% of the fully phased-in
cost savings.
The transaction, which is expected to close in the first quarter
of 2021, is subject to customary closing conditions, including
regulatory approvals, and approval from the shareholders of
Blue Ridge and Bay Banks.
Blue Ridge was advised in the
transaction by Raymond James &
Associates, Inc. as financial advisor and Troutman Pepper Hamilton
Sanders LLP as legal counsel. Bay Banks was advised in the
transaction by Piper Sandler Companies as financial advisor and
Williams Mullen as legal counsel.
Strategic Risk Associates, LLC advised both parties on credit
analysis and testing.
About Blue Ridge Bankshares, Inc.
Blue Ridge Bankshares, Inc. operates under the supervision and
regulation of the Board of Governors of the Federal Reserve System
and the Bureau of Financial Institutions of the Virginia State
Corporation Commission, while Blue Ridge Bank, N.A. (the "Bank")
operates under a national charter subject to the supervision and
regulation of the Office of the Comptroller of the Currency. The
Bank provides commercial banking services to customers located
primarily in the Piedmont,
Southside, and Shenandoah Valley regions of the Commonwealth of
Virginia and also operates under
the name Carolina State Bank in
Greensboro, North Carolina.
Mortgage lending services are provided in these regions as well
with additional mortgage offices located in Northern Virginia, Maryland, North
Carolina, and South
Carolina.
About Bay Banks of Virginia,
Inc.
Bay Banks of Virginia, Inc. is
the bank holding company for Virginia Commonwealth Bank and VCB
Financial Group, Inc. Founded in the 1930s, Virginia Commonwealth
Bank is headquartered in Richmond,
Virginia. With 18 banking offices, located throughout the
greater Richmond region of
Virginia, the Northern Neck region
of Virginia, Middlesex County, and the Hampton Roads region of Virginia, the bank serves businesses,
professionals, and consumers with a wide variety of financial
services, including retail and commercial banking, and mortgage
banking. VCB Financial Group provides management services for
personal and corporate trusts, including estate planning, estate
settlement and trust administration, and investment and wealth
management services.
Additional Information About the Merger and Where to Find
It
In connection with the proposed merger, Blue Ridge intends to file with the Securities
and Exchange Commission (the "SEC") a registration statement on
Form S-4, which will include a joint proxy statement/prospectus to
be mailed to shareholders of both Blue
Ridge and Bay Banks. SECURITY HOLDERS OF BLUE RIDGE AND Bay Banks ARE ADVISED TO READ
THE REGISTRATION STATEMENT AND THE JOINT PROXY STATEMENT/PROSPECTUS
WHEN THEY BECOME AVAILABLE AND ANY OTHER DOCUMENTS FILED WITH THE
SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS,
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION REGARDING
BLUE RIDGE, Bay Banks AND THE
PROPOSED MERGER TRANSACTION. Security holders may obtain free
copies of these documents, once they are filed, and other documents
filed with the SEC on the SEC's website at http://www.sec.gov.
Security holders will also be able to obtain these documents, once
they are filed, free of charge, by requesting them in writing from
Brian K. Plum, Blue Ridge
Bankshares, Inc., 17 West Main Street, Luray, Virginia 22835, or by telephone at
(540) 743-6521, or from Randal R.
Greene, Bay Banks of Virginia, Inc., 1801 Bayberry Court,
Richmond, Virginia 23226, or by
telephone at (804) 435-1171.
Blue Ridge, Bay Banks and their
respective directors and executive officers may be deemed to be
participants in the solicitation of proxies from the shareholders
of Blue Ridge and Bay Banks in
connection with the proposed merger. Information about the
directors and executive officers of Blue
Ridge and Bay Banks will be included in the joint proxy
statement/prospectus when it becomes available. Additional
information regarding the interests of those persons and other
persons who may be deemed participants in the transaction may be
obtained by reading the joint proxy statement/prospectus regarding
the proposed merger when it becomes available. You may obtain free
copies of each document as described in the preceding
paragraph.
This release does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or proxy in favor of the merger, nor shall there be any
sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction.
Cautionary Note Regarding Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements include, but are not
limited to, statements about (i) the benefits of a merger (the
"Merger") between Blue Ridge and
Bay Banks, including future financial and operating results, cost
savings, enhancements to revenue and accretion to reported earnings
that may be realized from the Merger; (ii) Blue Ridge's and Bay Banks's plans,
objectives, expectations and intentions and other statements
contained in this presentation that are not historical facts; and
(iii) other statements identified by words such as "may",
"assumes", "approximately", "will", "expects", "anticipates",
"intends", "plans", "believes", "seeks", "estimates", "targets",
"projects", or words of similar meaning generally intended to
identify forward-looking statements. These forward-looking
statements are based upon the current beliefs and expectations of
the respective management of Blue
Ridge and Bay Banks and are inherently subject to
significant business, economic and competitive uncertainties and
contingencies, many of which are beyond the control of Blue Ridge and Bay Banks. In addition,
these forward- looking statements are subject to various risks,
uncertainties and assumptions with respect to future business
strategies and decisions that are subject to change and difficult
to predict with regard to timing, extent, likelihood and degree of
occurrence. As a result, actual results may differ materially
from the anticipated results discussed in these forward-looking
statements because of possible uncertainties.
The following factors, among others, could cause actual results
to differ materially from the anticipated results or other
expectations expressed in the forward-looking statements: (1) the
businesses of Blue Ridge and Bay
Banks may not be combined successfully, or such combination may
take longer, be more difficult, time-consuming or costly to
accomplish than expected; (2) the expected growth opportunities or
cost savings from the Merger may not be fully realized or may take
longer to realize than expected; (3) deposit attrition, operating
costs, customer losses and business disruption following the
Merger, including adverse effects on relationships with employees
and customers, may be greater than expected; (4) the regulatory
approvals required for the Merger may not be obtained on the
proposed terms or on the anticipated schedule; (5) the shareholders
of Blue Ridge or Bay Banks may
fail to approve the Merger; (6) economic, legislative or regulatory
changes, including changes in accounting standards, may adversely
affect the businesses in which Blue
Ridge and Bay Banks are engaged; (7) the interest rate
environment may further compress margins and adversely affect net
interest income; (8) results may be adversely affected by continued
diversification of assets and adverse changes to credit quality;
(9) competition from other financial services companies in
Blue Ridge's and Bay Banks's
markets could adversely affect operations; (10) an economic
slowdown could adversely affect credit quality and loan
originations; (11) the COVID-19 pandemic is adversely affecting
Blue Ridge, Bay Banks, and their
respective customers, employees and third-party service providers;
the adverse impacts of the pandemic on their respective business,
financial position, operations and prospects have been material,
and it is not possible to accurately predict the extent, severity
or duration of the pandemic or when normal economic and operation
conditions will return; and (12) other factors that may affect
future results of Blue Ridge and
Bay Banks, including: changes in asset quality and credit risk; the
inability to sustain revenue and earnings growth; changes in
interest rates and capital markets; inflation; customer borrowing,
repayment, investment and deposit practices; the impact, extent and
timing of technological changes; capital management activities; and
other actions of the bank regulatory agencies and legislative and
regulatory actions and reforms. Additional factors, that could
cause actual results to differ materially from those expressed in
the forward-looking statements are discussed in Blue Ridge's and Bay Banks's reports (such as
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K) filed with the Securities and Exchange
Commission (the "SEC") and available on the SEC's Internet site
(http://www.sec.gov).
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SOURCE Blue Ridge Bankshares, Inc.