First Interstate BancSystem, Inc. (“First Interstate”) (NASDAQ:
FIBK) and Cascade Bancorp (“Cascade”) (NASDAQ: CACB) today
announced that they have entered into a definitive agreement under
which First Interstate, parent company of First Interstate Bank,
will acquire Cascade, parent company of Bank of the Cascades, in a
cash and stock transaction for total consideration valued at
approximately $589 million in aggregate, or $7.60 per share based
on the First Interstate closing price of $38.30 per share on
November 16, 2016. The transaction creates a unique regional
banking franchise that extends from the Mountain West to the
Pacific Northwest and provides First Interstate with a presence in
several high-growth markets, including Bend, Oregon and Boise,
Idaho.
Cascade is a relationship-oriented community bank based in Bend,
Oregon with total assets of $3.2 billion, deposits of $2.7 billion,
loans of $2.1 billion and 50 banking offices across Oregon, Idaho
and Washington. After completion of the acquisition, First
Interstate will have approximately $12.1 billion in total assets,
$10.1 billion in total deposits, $7.6 billion in total loans and
131 banking offices.
“We are very excited to announce this transformational
acquisition that leverages our significant investment in people,
processes and technology. This opportunity is a good fit for us
geographically, strategically, financially and culturally.
Cascade’s operating philosophy, commitment to community banking and
corporate responsibility are similar to ours, allowing for a
seamless integration of our two companies,” said First Interstate
President and Chief Executive Officer, Kevin Riley. “We are pleased
to welcome Cascade’s employees, customers and shareholders and look
forward to continuing the good work that Cascade has been doing.
Both of our banks have very strong, relationship-centered cultures
and this is an ideal extension of First Interstate into markets we
have been evaluating for several years,” continued Mr. Riley.
“We believe First Interstate is an exceptional banking partner
for Cascade,” commented Terry Zink, President and Chief Executive
Officer of Cascade Bancorp. “Strategically they intend to grow
Cascade’s branch network, as well as our metropolitan commercial
banking centers across the northwest. It follows that they highly
value the many Cascade bankers who are on the front line with our
customer relationships and are committed to ensuring our loyal
customers will benefit from this combination.”
Zink continued, “For nearly 50 years, First Interstate has
demonstrated strong and stable banking leadership. Today, they are
a recognized leader in community banking and consistently deliver
quality and competitive financial services to their customers while
making a clear and positive difference in the communities they
serve. In light of our shared culture and commitment to community,
I am excited for the prospects of our combined companies. Together,
we will continue to deliver a highly personalized experience to our
customers with the expanded set of products and services that First
Interstate will provide our customers. Employees and shareholders
will be well-served as part of the First Interstate family.”
Pursuant to the terms of the definitive merger agreement,
Cascade shareholders will receive 0.14864 shares of First
Interstate Class A common stock and $1.91 in cash in exchange for
each share of Cascade common stock they hold. The exchange ratio is
fixed and the portion of shares received by Cascade shareholders is
expected to qualify as a tax-free exchange. Cascade shareholders
will own approximately 20% of the outstanding capital stock of
First Interstate once the transaction is complete.
First Interstate expects the transaction will result in
long-term annual earnings per share “EPS” accretion of 10% and 2018
EPS accretion of over 8% after accelerating the debit interchange
limitations from the Durbin amendment brought on by crossing $10
billion in consolidated total assets. First Interstate is expected
to recover the tangible book value dilution experienced in this
transaction in five years.
The boards of directors of each company have unanimously
approved the transaction, and the directors and certain large
shareholders of Cascade have entered into agreements with First
Interstate pursuant to which they have agreed to vote their shares
of Cascade common stock in favor of the transaction. Additionally,
the directors of First Interstate have entered into agreements with
Cascade pursuant to which they have agreed to vote their shares of
First Interstate common stock in favor of the transaction.
First Interstate and Cascade expect to close the transaction in
mid-2017 after satisfaction of customary closing conditions,
including regulatory approvals and the approvals of the First
Interstate and Cascade shareholders. Immediately following the
completion of the acquisition, it is anticipated that Bank of the
Cascades will be merged with and into First Interstate Bank. Two
members of Cascade’s Board of Directors will be added to the First
Interstate Board of Directors in order to maintain the community
commitment that Cascade has established in important markets in the
Pacific Northwest.
Barclays Capital Inc. served as exclusive financial advisor and
Luse Gorman, PC served as legal counsel to First Interstate. Piper
Jaffray & Co. served as exclusive financial advisor and Hunton
& Williams LLP served as legal counsel to Cascade.
CONFERENCE CALL
First Interstate and Cascade management will review additional
information regarding the transaction in a conference call
beginning at 10:00 a.m. Mountain Time on Friday, November 18, 2016.
The call may be accessed by dialing 1-877-507-0356. To participate
via the Internet, log on to www.FIBK.com. A replay will be
available approximately one hour after the end of the conference
call by dialing 1-877-344-7529. The conference ID is 10096941. The
call will also be archived on our website, www.FIBK.com.
About First Interstate BancSystem, Inc. and First Interstate
Bank
First Interstate BancSystem, Inc. (NASDAQ: FIBK), is a financial
services holding company, headquartered in Billings, Montana, with
$9.0 billion in assets as of September 30, 2016. It is the parent
company of First Interstate Bank, a community bank operating 81
banking offices, including online and mobile banking services,
throughout Montana, Wyoming and South Dakota. As a recognized
leader in community banking services with 28 consecutive years of
profitability, First Interstate is driven by strong family and
corporate values, as well as a commitment to long-term organic
growth, exemplary customer service, exceeding customer expectations
through its products and services, and supporting, with leadership
and resources, the communities it serves.
About Cascade Bancorp and Bank of the
Cascades
Cascade Bancorp (NASDAQ: CACB), headquartered in Bend, Oregon,
and its wholly owned subsidiary, Bank of the Cascades, operates in
the Pacific Northwest. Founded in 1977, Bank of the Cascades offers
full-service community banking through 50 branches in Oregon, Idaho
and Washington. The Bank has a business strategy that focuses on
delivering the best in community banking for the financial
well-being of customers and shareholders. It executes its strategy
through the consistent delivery of full relationship banking
focused on attracting and retaining value-driven customers.
Cautionary Note Regarding Forward Looking Statements
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Rule 175 promulgated thereunder, and Section 21E of
the Securities Exchange Act of 1934, as amended, and Rule 3b-6
promulgated thereunder, that involve inherent risks and
uncertainties. Any statements about First Interstate’s or the
combined company’s plans, objectives, expectations, strategies,
beliefs, or future performance or events constitute forward-looking
statements. Such statements are identified as those that include
words or phrases such as “believes,” “expects,” “anticipates,”
“plans,” “trend,” “objective,” “continue” or similar expressions or
future or conditional verbs such as “will,” “would,” “should,”
“could,” “might,” “may” or similar expressions. Forward-looking
statements involve known and unknown risks, uncertainties,
assumptions, estimates and other important factors that could cause
actual results to differ materially from any results, performance
or events expressed or implied by such forward-looking statements.
Such forward-looking statements include but are not limited to
statements about the benefits of the business combination
transaction involving First Interstate and Cascade, including
future financial and operating results, the combined company’s
plans, objectives, expectations and intentions, and other
statements that are not historical facts. These forward-looking
statements are subject to risks and uncertainties that may cause
actual results to differ materially from those projected, including
but not limited to the following: the possibility that the merger
does not close when expected or at all because required regulatory,
shareholder or other approvals and other conditions to closing are
not received or satisfied on a timely basis or at all; the risk
that the benefits from the transaction may not be fully realized or
may take longer to realize than expected, including as a result of
changes in general economic and market conditions, interest and
exchange rates, monetary policy, laws and regulations and their
enforcement, and the degree of competition in the geographic and
business areas in which First Interstate and Cascade operate; the
ability to promptly and effectively integrate the businesses of
First Interstate Bank and Cascade; the reaction of the companies’
customers, employees and counterparties to the transaction; and the
diversion of management time on merger-related issues.
These factors are not necessarily all of the factors that could
cause First Interstate’s, Cascade’s or the combined company’s
actual results, performance or achievements to differ materially
from those expressed in or implied by any of the forward-looking
statements. Other unknown or unpredictable factors also could harm
First Interstate’s, Cascade’s or the combined company’s
results.
All forward-looking statements attributable to First Interstate,
Cascade or the combined company or persons acting on First
Interstate’s or Cascade’s behalf are expressly qualified in their
entirety by the cautionary statements set forth above.
Forward-looking statements speak only as of the date they are made
and First Interstate and Cascade do not undertake or assume any
obligation to update publicly any of these statements to reflect
actual results, new information or future events, changes in
assumptions or changes in other factors affecting forward-looking
statements, except to the extent required by applicable laws. If
First Interstate or Cascade updates one or more forward-looking
statements, no inference should be drawn that First Interstate or
Cascade will make additional updates with respect to those or other
forward-looking statements.
Additional Information About the Merger and Where to Find
it
This communication is being made with respect to the proposed
transaction involving First Interstate and Cascade. This material
is not a solicitation of any vote or approval of the First
Interstate or Cascade shareholders and is not a substitute for the
joint proxy statement/prospectus or any other documents that First
Interstate and Cascade may send to their respective shareholders in
connection with the proposed merger. This communication does not
constitute an offer to sell or the solicitation of an offer to buy
any securities.
In connection with the proposed merger, First Interstate will
file with the Securities and Exchange Commission (the “SEC”) a
Registration Statement on Form S-4 that will include a joint proxy
statement of First Interstate and Cascade and a prospectus of First
Interstate, as well as other relevant documents concerning the
proposed merger. Before making any voting or investment
decisions, investors and shareholders are urged to read the
Registration Statement and the joint proxy statement/prospectus
regarding the proposed Merger, as well as any other relevant
documents filed with the SEC and any amendments or supplements to
those documents, because they will contain important
information. Both First Interstate and Cascade will mail the
joint proxy statement/prospectus to their respective shareholders.
Shareholders are also urged to carefully review and consider each
of First Interstate’s and Cascade’s public filings with the SEC,
including, but not limited to, their Annual Reports on Form 10-K,
their proxy statements, their Quarterly Reports on Form 10-Q, and
their Current Reports on Form 8-K. Copies of the Registration
Statement and joint proxy statement/prospectus and other filings
incorporated by reference therein, as well as other filings
containing information about First Interstate and Cascade, may be
obtained as they become available at the SEC’s Internet site
(http://www.sec.gov). You will also be able to obtain these
documents, free of charge, from First Interstate at www.fibk.com or
from Cascade at www.botc.com.
First Interstate, Cascade and certain of their respective
directors and executive officers, under the SEC’s rules, may be
deemed to be participants in the solicitation of proxies of First
Interstate’s and Cascades shareholders in connection with the
proposed transaction. Information about the directors and executive
officers of First Interstate and their ownership of First
Interstate common stock is set forth in the proxy statement for
First Interstate’s 2016 Annual Meeting of Shareholders, as filed
with the SEC on Schedule 14A on April 4, 2016. Information about
the directors and executive officers of Cascade and their ownership
of Cascade common stock is set forth in the proxy statement for
Cascade’s 2016 Annual Meeting of Shareholders, as filed with the
SEC on Schedule 14A on April 13, 2016. Additional information
regarding the interests of those participants 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. Free copies of this document may
be obtained as described in the preceding paragraph.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161117006356/en/
First Interstate BancSystem, Inc.:Investor
Relations:Chief Financial OfficerMarcy Mutch,
406-255-5312marcy.mutch@fib.comorMedia:Cynthia Lyle,
406-255-5337cynthia.lyle@fib.comorCascade Bancorp:Debbie
Amerongen, 541-617-3572debbiea@botc.com
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